Crocs gains after Raymond James calls a bottom with positive momentum building
Crocs (NASDAQ:CROX) pushed higher in early trading on Friday after Raymond James upgraded the footwear stock to an Outperform rating after having it set at Market Perform.
The firm thinks Crocs (CROX) is oversold after a 30% swing lower over the last three months. The risk-reward profile is now seen as favorable off a highly discounted P/E of ~6.5X vs. the five-year average of 16X. It was also noted that the Crocs brands surprised to the upside in the first half of the year, and is seeing further momentum based on Google Trends and mobile app data checks. Meanwhile, HEYDUDE’s challenges are said to be well-known and baked into the share price. In addition, Crocs’ (CROX) strong operating margins and free cash flow are seen setting up the company to fire off accretive buybacks and debt paydown.
Raymond James assigned a price target of $110 to CROX. Shares rose 1.75% in premarket trading to $85.88. Short interest on CROX stands at 9.8% of the total float.