Crocs (CROX) Spiking After Positive Note From Wedbush Morgan

Crocs (Nasdaq: CROX) is seeing strength today and is up 19% to $2.75 after Wedbush Morgan came out with a positive research note.

When Crocs' reports Q1 EPS on Thursday, Wedbush expects its results to come in above the consensus view, but cutting costs will be key.

Wedbush said Crocs' new CEO brings important consumer product and footwear expertise to company. The CEO has footwear experience as President and COO at Reebok from 1990-1995, and more
recently was the founder and owner of the Chrysallis Group, a consulting group focused
on the development and renewal of brands. Wedbush thinks he could use his experience with re-building brands to re-ignite to Crocs' brand.

Although, Wedbush expects Crocs to exceed the analyst consensus view and is impressed with the CEO, it is still cautious on Crocs and recommends that investors avoid shares of CROX given the significant uncertainties related to the company’s business.
Wedbush said some of these risks include:

• inability to adapt to changes in tastes and create new styles that appeal to consumers
  
• inability to continue to successfully expand into international markets
  
• inability to protect intellectual property, especially nature of croslite material
  
• consumer weakness due to macroeconomic factors.

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