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I have my eyes on you !


Thu, Feb 5,2009 - Price $10/share
Skechers expects large 4Q loss on higher markdowns (After Bell)

Fri, Feb 6, 2009 - Price $7,42/share
Ahead of the Bell: Analyst cuts Skechers' rating
Skechers USA downgraded by: Susquehanna Financial, Sterne Agee and Wedbush Morgan

Thu, Feb 19, 2009 - price $7/share
Skechers posts 4th-quarter loss as margins shrink

Thu, Mar 5, 2009 - price $5,4



The company posted a loss in its fourth quarter mainly due to lower margins as the company slashed prices to unload inventory.The company expects to break even in the first half of 2009, return to profitability in the second half of the year.

Analysts earnings growth estimate this year - 73,1%
Analysts earnings growth estimate next year +181.3%

By pelcmarek at 2009-03-12 14:02 | Stocks | pelcmarek's blog


SKX: Upgrade is on the way !


By Jonathan Heller

While it may be difficult to get excited these days about yet another "faddish" company that is trading cheap relative to its net current assets, it's equally difficult to ignore such a company that happens to have a nearly pristine balance sheet. When I look at such companies these days, my focus is on their ability to weather this economic storm, which can be done given a healthy amount of liquidity.


Skechers exemplifies this very notion as a fairly well-known footwear brand in what is an intensely competitive industry. The whims of consumers make this business difficult enough; add a recession and major slowdown in consumer spending and all bets are off, especially when lower-priced brands are readily available.
 

Last year was actually decent for Skechers given the circumstances. Sales rose 3.3% to $1.44 billion, while net income fell nearly 27% to $55.4 million. Under more normal economic conditions, that might be deemed a terrible year.


Granted, the fourth quarter was ugly: sales fell 1.3% to $298.1 million, gross margin fell nearly 1,000 basis points and the company lost $20.4 million vs. a net of $12.1 million for the same period last year. Clearly, the dreadful retail environment and lack of pricing power reared their heads for the company late in the year.


But Skechers continues to have a solid balance sheet and its share price has been beaten to the point that it now trades below its net current asset value (NCAV). In fact, shares are down 74% from their 52-week high ($25.20).


The company ended the year with $115 million or $2.50 per share in cash. With just $17 million in debt, net cash is still a healthy $2.13 per share. With total current assets of $602 million and total liabilities (including minority interest) of just $208 million, the company's net current asset value is $394 million. With a current market cap of $304 million, Skechers currently trades at just 0.77 times NCAV.


Of course, the net/net calculation ignores the value of any long-term assets on a company's books and this can be part of the "safety net" embedded within certain net/nets. While there's sometimes little in the way of value here for some companies, Skechers does bring something to the table.


 

Total long-term assets are listed at $274.3 million, including long-term marketable securities on the books at $81.9 million or $1.77 per share. While these securities are auction-rate preferreds, assuming they are money-good, thats fairly compelling when considered along with $157.8 million in net property, plant and equipment and $29 million in deferred tax and other assets are also thrown in for free.


While current consensus analyst estimates are calling for losses in each of the next two quarters (down two cents in March and five cents in June), the full year looks brighter with sales of $1.28 billion and earnings 32 cents per share. Estimates for 2010 currently call for sales of $1.45 billion and earnings of 90 cents per share. That puts the forward P/E based on 2010 earnings at 7.


Trading at just 0.77 times net current asset value, with $2.13 in net cash, Skechers appears to be priced for the scrap heap at $6.57.

By pelcmarek at Sun, 2009-03-29 11:54 | login or register to post comments

Let's just beat the crap out of them !


Footwear maker Skechers USA posts 1st-quarter profit, instead of loss analysts had expected.

The results easily topped expectations of analysts surveyed by Thomson Reuters, who had expected a loss of 9 cents a share on revenue of $333.0 million.
By pelcmarek at Thu, 2009-04-30 03:30 | login or register to post comments