Maybe a Pine Tree

Captain Hook says avoid Crocs!

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This week CROX announced earnings, and folks got excited and the stock went up 10%, well guess what? I still dislike it and I'll still short this footwear company that seems to act like a volatile biotech stock.

Now, not to toot my own prediction, but back in this article,

I had complained about CROX and made this statement:

"Avoid this one, pick up a copy of Backpacker magazine, read the reviews on hiking shoes and buy something else instead"

And so I got a subscription to Backpacker magazine, I'm reading their Gear Guide and I'm going to buy something other than CROX for my hikes this year. By doing so, I have avoided the -55% drop that the stock has experienced since that time. I don't always get these stock predictions right, but when it happens to go in my favor - it sure feels good.

Now, once again I'll look at the value, quality, smart money and growth stories for CROX.

Value
CROX has a low (nice?) PE and price/book, but it also has high (poor?) price/cash flows. With updated earnings into my model, I get a price target of $13. With the poor price/cash flow, it's a 'short', but the other variables tell me that it's a 'Long'.

Quality
CROX has high (poor?) accruals and a high F-score. Short.

Smart Money
Poor high short interest, but the insiders haven't sold recently. Now, for those who don't think that insider selling counts, what do you think of the insider selling that happened last year when the stock was at $40, $50, $60? Does it make you pause and wonder: Did the insiders know something? Did they think it was overpriced? Should you have thought the same? Short, but if the insiders buy more and the short interest declines, then it's a 'Long'.

Growth
They have very high sales growth, and in my opinion that can't continue. Short.

My Opinion

I think CROX could appeal to some value investors hoping for a turn-around story, it could also appeal to those growth investors that love fluctuating high growth rates. But, with high price/cash flows, high accruals, a high F-score, high short interest, and "abnormal" growth rates, I'm going to pass on CROX and stay 'Short'.