Investors seeking growth at a reasonable cost should explore NYSE:SKX.

Last update: Jan 1, 2024

Discover SKECHERS USA INC-CL A (NYSE:SKX), an undervalued growth gem identified by our stock screener. NYSE:SKX is shining in terms of growth metrics, and it's also displaying strong financial health and profitability. What's more, it retains an appealing valuation. We'll break it down further.

Analyzing Growth Metrics

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:SKX has achieved a 7 out of 10:

SKX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 46.35%, which is quite impressive.
The Revenue has grown by 9.65% in the past year. This is quite good.
SKX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.32% yearly.
Based on estimates for the next years, SKX will show a very strong growth in Earnings Per Share. The EPS will grow by 20.31% on average per year.
The Revenue is expected to grow by 9.11% on average over the next years. This is quite good.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

A Closer Look at Valuation for NYSE:SKX

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NYSE:SKX has achieved a 6 out of 10:

Compared to an average S&P500 Price/Earnings ratio of 26.08, SKX is valued a bit cheaper.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.99, SKX is valued a bit cheaper.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SKX indicates a somewhat cheap valuation: SKX is cheaper than 63.27% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SKX indicates a somewhat cheap valuation: SKX is cheaper than 73.47% of the companies listed in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of SKX may justify a higher PE ratio.
A more expensive valuation may be justified as SKX's earnings are expected to grow with 27.80% in the coming years.

Evaluating Health: NYSE:SKX

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:SKX was assigned a score of 7 for health:

SKX has an Altman-Z score of 4.28. This indicates that SKX is financially healthy and has little risk of bankruptcy at the moment.
SKX has a better Altman-Z score (4.28) than 71.43% of its industry peers.
The Debt to FCF ratio of SKX is 0.41, which is an excellent value as it means it would take SKX, only 0.41 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 0.41, SKX is doing good in the industry, outperforming 79.59% of the companies in the same industry.
SKX has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.07, SKX is doing good in the industry, outperforming 69.39% of the companies in the same industry.
A Current Ratio of 2.52 indicates that SKX has no problem at all paying its short term obligations.
The Quick ratio of SKX (1.60) is better than 65.31% of its industry peers.

Exploring NYSE:SKX's Profitability

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:SKX was assigned a score of 7 for profitability:

SKX has a Return On Assets of 7.38%. This is in the better half of the industry: SKX outperforms 67.35% of its industry peers.
SKX has a Return On Equity of 13.51%. This is in the better half of the industry: SKX outperforms 63.27% of its industry peers.
SKX's Return On Invested Capital of 10.53% is fine compared to the rest of the industry. SKX outperforms 75.51% of its industry peers.
The last Return On Invested Capital (10.53%) for SKX is above the 3 year average (6.98%), which is a sign of increasing profitability.
With a decent Profit Margin value of 6.75%, SKX is doing good in the industry, outperforming 69.39% of the companies in the same industry.
SKX's Profit Margin has improved in the last couple of years.
SKX has a Operating Margin of 9.36%. This is in the better half of the industry: SKX outperforms 65.31% of its industry peers.
SKX has a Gross Margin of 50.78%. This is in the better half of the industry: SKX outperforms 63.27% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

Check the latest full fundamental report of SKX for a complete fundamental analysis.

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.