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Investing.com - Argus downgraded Skechers USA (NYSE:SKX) from Buy to Hold on Tuesday following the footwear company’s acquisition agreement with 3G Capital. The company, which has maintained strong financial health with an InvestingPro rating of "GOOD" and impressive revenue growth of 12% over the last twelve months, operates with moderate debt levels.
The $9.42 billion deal, announced at $63 per share, represents a 30% premium to Skechers’ 15-day average share price.
Argus noted that Skechers shares are already trading at the $63 acquisition price, which sits well above the firm’s previous price target.
The research firm does not expect Skechers stock to move higher from current levels, prompting the downgrade decision.
3G Capital’s acquisition of Skechers adds the footwear brand to the investment firm’s portfolio, which has previously included stakes in major consumer companies like Kraft Heinz and Restaurant Brands International.
In other recent news, UBS has reiterated its Neutral rating on Skechers USA, maintaining a price target of $63.00. This decision is primarily influenced by Skechers’ pending acquisition, which UBS believes plays a significant role in their assessment. The investment bank highlighted that Skechers is one of the world’s largest footwear brands, with growth potential that is not fully recognized by the market. UBS also mentioned that demand for Skechers products remains strong, and the brand’s name is at its peak strength. These developments are part of the recent updates surrounding Skechers.
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