Sunday, July 26, 2015

Company profile: Skechers (SKX)

Skechers (NYSE: SKX) is a designer and marketer of Skechers-branded lifestyle footwear for men, women and children, and performance footwear for men and women under the Skechers GO brand name.
  • Market cap:  $6.4B
  • Net profit margin 8.03% (Mar'15)
  • Skechers' sales jumped more than 40% to $768 million for the first three months of the year, after hitting a record $2.4 billion in 2014.
  • website:
  • HQ: Manhattan Beach, California, USA 
  • Competitors: Nike (NYSE:NKE), Under Armour (UA), Steve Madden (NASDAQ: SHOO), Asics.
  • In 2014, Skechers-sponsored marathoner Meb Keflezighi became the first runner to win the Boston Marathon in the company's shoes, as well as the first American to win the race in 29 years.
  • Skechers has sprinted past Adidas, New Balance, and others to grab the No. 2 brand share position in the U.S. athletic footwear market, behind Nike (NYSE:NKE). Nike’s  holds 62% of the athletic shoe market.
  • Skechers is succeeding today in categories where Nike falls short -- specifically, walking and casual footwear. The company has gained ground with products such as its Skechers Memory Foam sneakers, Stretch Fit, and Relaxed Fit footwear.
  • Skechers has carved out a niche with its "walking shoes," leading the domestic casual athletic footwear category with 22% share in Q1 2015, according to research firm NPD Group.  Converse, a Nike-owned brand, came in second with 15% share, while Nike (NKE) trailed in third place with 10% of the market.
  • Skechers resonates with tweens, teens, and Millennials. The company's kids segment is vast and growing fast. Some of the more popular brands within Skechers' kids category include S-Lights and Hot Lights, Skechers Airators, Skechers Super Z-strap, and Elastika.
  • Another strength: lower price point of Skechers' kids shoes. The cheapest pair of Nike boy's sportswear shoes, for example, cost $70 today, compared to $40 for a similar pair from Skechers.
  • Also giving Skechers a lift has been the rise of the so-called athleisure trend--whereby sportswear has become appropriate for everyday fashion, even at the office. The demand for lower-priced sport-styled footwear has upended the running shoe industry, as more affordable brands crowd into the athletic category and demand for higher-priced premium sneakers slows.
  • But Nike remains the overall sports footwear leader with 62% share, while Skechers sits a distant second at 5%. Under Armour (NYSE:UA), with a footwear category that is booming but nascent, has yet to crack the top-five list.

Skechers - monthly


The infamous Skechers toning shoe fiasco saw the footwear maker pay $40 million to the Federal Trade Commission to settle claims it deceived consumers into believing you could tone up your muscles by wearing its ShapeUps shoes.

©Artremis / Eva Sawicka (7/15)

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