Barclays bullish on Crocs, sees multi-year growth story

Investing.com -- Barclays analyst Adrienne Yih upgraded Crocs to Overweight from Equal Weight and raised its price target to $139 from $118 in a note Thursday.

Crocs shares are up 3.9% shortly after the open.

Yih told investors that visibility into a broader recovery has improved meaningfully. Crocs International is already growing, Crocs North America returned to growth in the second quarter, and the HEYDUDE brand is expected to return to growth in the second half.

“In our view, CROX is moving beyond a period of stabilization and into the early stages of a more sustainable growth cycle,” Yih wrote.

She added that many of the company’s strongest-performing products are newer franchises outside the traditional Classic Clog, giving her greater confidence that growth is becoming broader and more durable.

The analyst noted that sandals have emerged as a meaningful contributor, with management expecting the category to approach $500 million in annual revenue.

Management has deliberately reduced promotional activity, which has pressured near-term revenue but reset the business toward healthier full-price sales.

Yih also called international expansion an underappreciated driver, with the brand still early in markets including China, India, Japan and Western Europe. International sales now account for about 49% of Crocs brand revenue.

“We see a pathway for investors to increasingly value CROX on its earnings growth algorithm rather than its turnaround risk,” she said.

Barclays raised its fiscal 2028 adjusted EPS estimate to $15.49 and applied a nine times multiple.

Original Article

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