Despite its growth, NYSE:SKX remains within the realm of affordability.

Last update: Mar 8, 2024

Consider SKECHERS USA INC-CL A (NYSE:SKX) as an affordable growth stock, identified by our stock screening tool. NYSE:SKX is showcasing impressive growth figures and is well-positioned in terms of profitability, solvency, and liquidity. Moreover, it seems to be priced reasonably. Let's dive deeper into the analysis.

Evaluating Growth: NYSE:SKX

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NYSE:SKX scores 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.
SKX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.78% yearly.
Looking at the last year, SKX shows a quite strong growth in Revenue. The Revenue has grown by 9.65% in the last year.
Measured over the past years, SKX shows a quite strong growth in Revenue. The Revenue has been growing by 11.50% on average per year.
SKX is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.50% yearly.
Based on estimates for the next years, SKX will show a quite strong growth in Revenue. The Revenue will grow by 8.14% on average per year.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Valuation Examination for NYSE:SKX

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:SKX has received a 5 out of 10:

Based on the Price/Earnings ratio, SKX is valued a bit cheaper than the industry average as 62.00% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 26.03, SKX is valued a bit cheaper.
SKX's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.06.
Based on the Enterprise Value to EBITDA ratio, SKX is valued a bit cheaper than 66.00% of the companies 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 64.00% 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.
SKX's earnings are expected to grow with 16.05% in the coming years. This may justify a more expensive valuation.

What does the Health looks like for NYSE:SKX

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:SKX, the assigned 7 reflects its health status:

SKX has an Altman-Z score of 4.24. This indicates that SKX is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of SKX (4.24) is better than 74.00% of its industry peers.
SKX has a debt to FCF ratio of 0.41. This is a very positive value and a sign of high solvency as it would only need 0.41 years to pay back of all of its debts.
The Debt to FCF ratio of SKX (0.41) is better than 82.00% of its industry peers.
SKX has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.07, SKX is in the better half of the industry, outperforming 70.00% 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.
With a decent Quick ratio value of 1.60, SKX is doing good in the industry, outperforming 64.00% of the companies in the same industry.

Analyzing Profitability Metrics

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:SKX, the assigned 7 is noteworthy for profitability:

SKX has a better Return On Assets (7.38%) than 70.00% of its industry peers.
With a decent Return On Equity value of 13.51%, SKX is doing good in the industry, outperforming 72.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 10.47%, SKX is in the better half of the industry, outperforming 78.00% of the companies in the same industry.
The 3 year average ROIC (9.66%) for SKX is below the current ROIC(10.47%), indicating increased profibility in the last year.
SKX has a better Profit Margin (6.75%) than 70.00% of its industry peers.
Looking at the Operating Margin, with a value of 9.36%, SKX is in the better half of the industry, outperforming 68.00% of the companies in the same industry.
In the last couple of years the Gross Margin of SKX has grown nicely.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

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

Disclaimer

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.