.September 10, 2024 at 1:54 PM

BofA Securities analysts reiterated a Buy rating and set a $179 price target on Crocs (NASDAQ:CROX), citing the stock’s attractive valuation and potential for multiple expansion. Crocs is trading at a low 9x P/E ratio, and strong execution could drive an improved valuation.

Concerns have arisen about Crocs’ core North American business slowing down, with management cautioning about flat sales in the region for the second half of 2024. The shift of Crocs’ business with Amazon from wholesale to direct-to-consumer may be masking potential underlying weakness.

Analysts estimate that the Amazon shift will contribute about 150 basis points to Crocs’ total sales growth this year. They forecast 1% growth in North America in the second half, with meeting guidance easing concerns about the brand’s strength.

Crocs’ Heydude (HD) segment is expected to see significant sales improvement in Q4, driven by new retail stores, international distributor sales, and timing shifts in product shipments. Analysts anticipate Heydude meeting the lower end of its sales guidance for the year, with any signs of sequential improvement likely well-received by the market.