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On Thursday, Evercore ISI adjusted its price target for Skechers USA (NYSE:SKX), reducing it to $60 from the previous $78, while still upholding an Outperform rating on the company’s shares. The adjustment comes ahead of the footwear company’s earnings report scheduled for April 24th, after the market closes. According to InvestingPro data, the stock has declined over 30% year-to-date and appears undervalued based on their proprietary Fair Value model, with analyst targets ranging from $50 to $94.
The firm’s analysts have shifted their focus from Skechers’ fundamental growth to the potential impact of tariffs on the company’s profit and loss statement. Despite these challenges, InvestingPro data shows the company maintains strong fundamentals with a healthy 53% gross margin and a moderate debt level. Skechers finds itself in a challenging position due to the ongoing trade tensions between China and the United States, particularly with the U.S. recently increasing tariffs on China by an additional 115%. It is important to note that the trade situation is volatile, with changes happening almost daily.
Skechers manufactures a significant portion of its products in China, accounting for 40-45% of its production, while another 40-45% is produced in Vietnam. The latter is currently subject to a temporary 10% tariff that will last for 90 days. This places Skechers in a unique and difficult situation, as the company has the largest manufacturing exposure to China within the Softlines sector covered by Evercore ISI.
The analyst’s report emphasizes the need for Skechers to identify strategies to navigate the uncertainties brought about by the trade wars. As the company prepares to report its earnings, the market will be watching closely to see how these tariff exposures will affect Skechers’ financial performance and what measures the company might take in response.
Investors and stakeholders in Skechers will likely be paying close attention to the forthcoming earnings report to assess the actual impact of the tariff situation on the company’s results and to gain insight into Skechers’ plans for mitigating these challenges. With a P/E ratio of 11.03 and strong financial health metrics according to InvestingPro, which offers comprehensive analysis through its Pro Research Report, the company appears well-positioned to navigate these challenges.
In other recent news, Skechers USA has been the focus of several analyst updates and financial projections. UBS recently adjusted its price target for Skechers to $64, maintaining a Buy rating, due to the company’s solid first quarter performance in 2025, despite potential challenges from new US tariffs. Evercore ISI has reiterated an Outperform rating with a $78 target, highlighting concerns over potential gross margin compression and a possible decline in earnings per share if pricing strategies are not adjusted. UBS also maintained a Buy rating with a $90 target, expressing confidence in Skechers’ growth potential and predicting a 13% compound annual growth rate in earnings per share over five years.
Stifel analysts have also maintained a Buy rating with an $80 price target, emphasizing Skechers’ strategic positioning and potential for international market growth. Meanwhile, Barclays (LON:BARC) adjusted its price target for Skechers to $77 from $80, maintaining an Overweight rating, based on anticipated financial adjustments including lower sales forecasts and increased costs. These developments indicate a cautious yet optimistic outlook from analysts, with varying expectations for Skechers’ financial performance amid economic pressures. Investors are closely monitoring these updates to assess Skechers’ potential for sustained growth and market expansion.
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