“Guggenheim Initiates Crocs Stock with Buy Rating, $182 Price Target”

Source: Davit Kirakosyan

Guggenheim analysts initiated coverage on Crocs (NASDAQ:CROX) with a Buy rating and set a price target of $182 on the stock, attributing the brand’s staying power and high global brand awareness to its success. The analysts see Crocs as well-positioned in the $160 billion casual footwear market, with a strong financial outlook driven by robust profitability—Crocs maintains industry-leading gross margins over 58% and operating margins above 25%.
For fiscal 2024 and 2025, the analysts forecast EPS of $12.90 and $14.00, respectively, and anticipate 2024 revenue of $4.12 billion. The analysts highlight Crocs’ estimated 9% free cash flow yield, which they consider undervalued, and point to the stock’s attractive valuation at just 9.8x 2025 EPS—placing it among the lowest in the footwear sector. Crocs’ debt leverage ratio is within its target range of 1-1.5x, which, paired with its repurchase program, offers potential EPS accretion of about $3 per share.
The analysts emphasized growth opportunities for both Crocs and the HEYDUDE brand, especially in international markets where Crocs holds competitive positioning in South Korea and see expansion potential in China, which currently accounts for only 4% of revenue. Despite consumer spending uncertainties in North America, the analysts expressed confidence in CEO Andrew Rees’ leadership to capitalize on Crocs’ value-driven strategy, functional design, and personalized offerings to achieve growth in a challenging market environment.

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