Skechers (SKX) Stock Up On Q2 Earnings Beat, Upbeat View
Zacks Investment Research | Jul 19, 2019 08:35AM ET
Shares of Skechers USA, Inc. (NYSE:SKX) surged 12.7% during the after-market trading session on Jul 18, following the company’s remarkable second-quarter 2019 results. Both the top and bottom lines surpassed the Zacks Consensus Estimate as well as increased year over year. In fact, this was the fourth straight quarter of positive earnings surprise. Impressive performance prompted management to provide an upbeat view for the third quarter.
This designer, developer, marketer and distributor of footwear posted quarterly earnings of 49 cents a share. The figure not only outpaced the Zacks Consensus Estimate of 33 cents but also increased substantially from 29 cents reported in the year-ago period.
Management guided third-quarter 2019 earnings in the range of 65-70 cents a share, whose mid-point of 67.5 cents is above the current Zacks Consensus Estimate of 65 cents. The company had reported earnings of 58 cents in the third quarter of 2018.
This Zacks Rank #1 (Strong Buy) company generated net sales of $1,258.6 million that increased 10.9% (or 13.7% on a constant currency basis) from the year-ago quarter and also beat the Zacks Consensus Estimate of $1,217 million.
The company now anticipates third-quarter 2019 net sales in the band of $1.325-$1.350 billion, up from $1.176 billion reported in the prior-year quarter. The Zacks Consensus Estimate for sales for the third quarter is $1.31 billion.
The company’s international wholesale and direct-to-consumer businesses acted as the primary catalysts. Management informed that the company witnessed growth across all regions with prominent markets being India, the Middle East and China. Moreover, the joint venture in Mexico with its distribution partner is performing well. The company is making strategic investments to improve its infrastructure worldwide, primarily e-commerce platforms and distribution centers. The company is also focusing on designing and developing of new products for the next year.
Certainly, the earnings beat streak and strategic endeavors have led the shares of Skechers to surge 31% in the past six months, comfortably outperforming the Zacks Investment Research
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