Recent stock volatility aside, analysts are keeping their expectations robust for Skechers USA Inc. ahead of Thursday’s Q1 earnings release.
According to Citi Research analyst Corinna Van der Ghinst, investor concerns regarding slower U.S. wholesale growth and elevated global inventories have weighed on the brand’s stock in recent months, but a likely Q1 beat will help to restore confidence.
“[We expect] a potential Q1 beat on stronger revenues driven by Easter’s shift from Q2 into Q1, more favorable weather trends, lapping last year’s port disruptions, and continued global demand,” Van der Ghinst wrote.
Further, easier year-on-year comparisons, “greater upside potential from international and lower expectations following recent downward Street revisions” will be additional drivers in the second half, the analyst added.
Van der Ghinst predicts Q1 earnings per share of 54 cents, in line with consensus, and 21 percent top-line growth. Average Wall Street estimates call for sales of around $917.3 million.
Susquehanna Financial Group LLLP analyst Christopher Svezia maintained a neutral rating on the brand but raised his revenue bet, from $901 million, to well above consensus, at $928 million. Svezia also added two cents to his previous EPS estimate, bringing it to 55 cents per share.
Svezia said he expects backlogs to remain in the single-digits with U.S. orders flat and international orders up high teens.
“While we believe the brand remains healthy and continues taking share, we remain neutral given elevated expectations for the balance of the year,” Svezia wrote in an earnings preview note on April 4. “For us to get more constructive, we would need to see backlogs accelerate in the U.S. or second-half expectations to become more subdued.”