Crocs shares fall following downgrade
Crocs Inc.'s shares fell Monday following a downgrade by a PiperJaffray analyst on concerns about worsening sales for the shoe maker.
THE SPARK: Analyst Erinn Murphy cut her rating on Crocs from "Overweight" to "Neutral" lowered her price target to $15 from $18.
THE BIG PICTURE: Crocs, based in Niwot, Colo., makes colorful plastic shoes for customers worldwide, but has been struggling with slower sales. The company is trying to expand beyond its signature clogs, but the strategy has yet to take hold.
THE ANALYSIS: Analyst Murphy said in a research note Monday that they see no reason for near-term growth for the company. Murphy said that Crocs has been discounting more of its products sold in the U.S. and sales appear to be worsening at some of its key wholesale accounts in Japan. The analyst also noted that other shoe companies have reported volatile customer traffic trends during the most recent quarter, which would worsen the picture if it holds true for Crocs.
SHARE ACTION: Shares of Crocs fell 61 cents, or 4.5 percent, to $13.07 by early afternoon, amid a broader market uptick. Its shares traded as low as $12.86 earlier in the day. Crocs shares plunged in July after posting disappointing quarterly results, and have yet to recover.