Crocs cut to hold by Williams Trading on weakening trends

Investing.com -- Williams Trading downgraded Crocs Inc (NASDAQ: CROX) to "Hold" from "Buy" and cut its price target to $112 from $127 given weakening trends in the flagship Crocs brand and continued softness in HEYDUDE.

Proprietary checks indicate U.S. retailers are planning flat Crocs sales and lower HEYDUDE sales in 2025, with no immediate signs of improvement.

The firm also reduced revenue and earnings estimates for Crocs through 2026, highlighting challenges in demand and strategic clarity for the HEYDUDE brand.

The recent appointment of ex-Yeezy designer Steven Smith as head of creative innovation for both brands adds uncertainty to near-term sales and margins. Williams Trading called for a more targeted approach to product and pricing strategies, including strategic use of minimum advertised price policies for core and non-core items.

HEYDUDE’s new product lineup, including sneakers, boots, and professional footwear, faces challenges due to a lack of demand-driven allocation strategies for its core styles, which represent the bulk of its revenue.

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