Why Crocs Might Be the Smarter Shoe Stock Pick Right Now

Nike’s been all over the news lately—new CEO, Bill Ackman’s $275M bet, you name it. But here’s a hot take: Crocs stock could actually be the better move.

Yeah, Crocs sounds boring. But the numbers tell a different story:

Margins: Crocs is sitting at 25%+ operating margin vs Nike’s 12%. That’s literally double. CEO Andrew Rees has been grinding since 2017 to improve profitability, and it shows.

Valuation: Nike trades at 23x earnings—yeah, it’s cheaper than before, but still in line with the S&P 500 average. Crocs? Less than 11x earnings. That’s a real discount.

Buyback power: When growth is modest (and for both these companies, it is), cheaper stock = more buybacks per dollar = better shareholder returns over time. This compounds big-time over years.

The X-factor: Everyone’s hyped on Nike’s new CEO catalyst. But Crocs has one too—HeyDude acquisition turnaround. Management says growth resumes before year-end.

Net sales growth: Crocs only up 5% YoY in H1 2024, but still beating on margins and valuation. Sometimes the unsexy play wins.