June 6, 2024
Top 10 Stock Crocs Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Crocs – Top 10 Stock in Nasdaq Composite Index
Crocs is listed as a top 10 stock on June 06, 2024 in the market index NASDAQ because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is growing above average and professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 50 (high 50% performer), Obermatt assesses an overall buy recommendation for Crocs on June 06, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Footwear |
| Index | Diversity USA, NASDAQ |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Crocs Buy
| 360 METRICS | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 13 |
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| GROWTH | ||||||||
| GROWTH | 67 |
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| SAFETY | ||||||||
| SAFETY | 18 |
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| SENTIMENT | ||||||||
| SENTIMENT | 100 |
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| 360° VIEW | ||||||||
| 360° VIEW | 50 |
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ANALYSIS: With an Obermatt 360° View of 50 (better than 50% compared with alternatives), overall professional sentiment and financial characteristics for the stock Crocs are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Crocs. The consolidated Growth Rank has a good rank of 67, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is higher than for 67% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 100, which means that professional investors are more optimistic about the stock than for 100% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 13, which means that the share price of Crocs is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 87% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 18, which means that the company has a financing structure that is riskier than those of 82% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 50, Crocs is better positioned than 50% of all alternative stock investment opportunities based on the Obermatt Method. Only half of the consolidated Obermatt Ranks exhibit excellent performance, so one needs to take a close look. Growth is above-average (Growth Rank of 67), and professional market sentiment is positive (Sentiment Rank of 100), but value and safety are below average. The Safety Rank is the least significant of the four consolidated ranks, because it only reflects financing practices. In the case of high growth, aggressive financing is a good thing. So the question is: How to assess below-average value against above-average growth and sentiment? Growth may be the strongest driver of the investment rationale in this case, which is reflected in institutional investors' opinions. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much do you sacrifice value for growth? You can use the following rule of thumb: If you take 100 minus the growth rank, you arrive at a possibly minimum level for the value rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the growth rank is above 60. Sometimes market sentiment just extrapolates the past, but sometimes it reflects reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Crocs very positive
ANALYSIS: With an Obermatt Sentiment Rank of 100 (better than 100% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Crocs is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Crocs. Analyst Opinions are at a rank of 95 (better than 95% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 99, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in Crocs. The Professional Investors rank is 97, which means that currently, professional investors hold more stock in this company than in 97% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 68 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 68% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 100 (more positive than 100% compared with investment alternatives), Crocs has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean Crocs stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: Crocs Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 13 (worse than 87% compared with alternatives), Crocs shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Crocs. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 74, which means that the stock price compared with what market professionals expect for future profits is lower than for 74% of comparable companies, indicating a good value concerning Crocs's profit levels. But Price-to-Sales is 8 which means that the stock price compared with what market professionals expect for future profits is higher than for 92% of comparable companies, indicating a low value concerning Crocs's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 19 and for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 13, is a sell recommendation based on Crocs's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Crocs is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. ...read more
Growth Strategy: Crocs Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 67 (better than 67% compared with alternatives), Crocs shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Crocs. Sales Growth has a rank of 65 which means that currently, professionals expect the company to grow more than 65% of its competitors. Capital Growth is also above 39% of competitors with a rank of 61, and Stock Returns with the rank of 67 is also an outperformance. Only Profit Growth is low with a rank of 39 which means that currently, professionals expect the company to grow its profits less than 61% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 67, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Crocs is a good growth stock. ...read more
Safety Strategy: Crocs Debt Financing Safety risky
| SAFETY METRICS | June 6, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 20 |
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| REFINANCING | ||||||||
| REFINANCING | 10 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 48 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 18 |
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ANALYSIS: With an Obermatt Safety Rank of 18 (better than 18% compared with alternatives), the company Crocs has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Crocs is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Crocs. Liquidity is at 48, meaning that the company generates less profit to service its debt than 52% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 20, meaning the company has an above-average debt-to-equity ratio. It has more debt than 80% of its competitors. Finally, Refinancing is at a rank of 10 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 90% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 18 (worse than 82% compared with alternatives), Crocs has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Crocs Lowest Financial Performance
| COMBINED PERFORMANCE | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 13 |
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| GROWTH | ||||||||
| GROWTH | 67 |
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| SAFETY | ||||||||
| SAFETY | 48 |
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| COMBINED | ||||||||
| COMBINED | 12 |
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ANALYSIS: With an Obermatt Combined Rank of 12 (worse than 88% compared with investment alternatives), Crocs (Footwear, USA) shares have lower financial characteristics compared with similar stocks. Shares of Crocs are low in value (priced high) with a consolidated Value Rank of 13 (worse than 87% of alternatives), and are riskily financed (Safety Rank of 18, which means above-average debt burdens) but show above-average growth (Growth Rank of 67). ...read more
RECOMMENDATION: A Combined Rank of 12, is a sell recommendation based on Crocs's financial characteristics. As the company Crocs shows low value with an Obermatt Value Rank of 13 (87% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 67% of comparable companies (Obermatt Growth Rank is 67). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 18 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Crocs, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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