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Tuesday, UBS analysts maintained a Buy rating on Wolverine World Wide (NYSE:WWW) and raised the price target to $18.00 from $17.00, adding to the broader analyst consensus of "Buy." According to InvestingPro data, the $973 million market cap company is currently trading below its Fair Value, with analyst targets ranging from $15 to $25.
Sole anticipates Wolverine will exceed expectations by $0.02 in Q1 earnings per share (EPS) and predicts the company will offer guidance for Q2 EPS that aligns with current expectations. With earnings due in 15 days and analysts forecasting FY2025 EPS of $1.23, investors following InvestingPro’s comprehensive analysis can access 8 additional ProTips and detailed financial metrics to better evaluate the company’s prospects.
Despite these concerns, the analyst suggests that the market has already accounted for these challenges. This perspective is based on the observation that Wolverine’s shares have declined by 49.6% over the last three months, a steeper drop compared to the S&P 500’s decrease of 12.4% during the same period.
Sole also noted the uncertainty surrounding the magnitude of the expected change in the FY25 EPS outlook among investors. This uncertainty has led to a wide range of potential outcomes for the stock around the upcoming earnings announcement.
The options market is currently anticipating a significant reaction to Wolverine’s earnings, pricing in a potential stock movement of +/-16.3%, which is more than double the historical average move of 7.6%. This expectation indicates that investors are preparing for higher-than-average volatility in response to the earnings report.
In other recent news, Wolverine World Wide has seen several noteworthy developments. The company’s revenue for ongoing businesses grew by 3% year over year in the fourth quarter of 2024, with the Saucony brand experiencing a 7% increase. S&P Global Ratings revised its outlook for Wolverine to stable from negative, citing improved operating performance and expected modest growth in 2025. Baird analysts upgraded Wolverine’s stock rating to Outperform, reflecting a positive outlook on the company’s risk/reward balance and limited sourcing from China. Stifel analysts maintained a Buy rating with a $27.00 price target, emphasizing confidence in Wolverine’s strategic vision and potential for growth, particularly in the Merrell and Saucony brands.
Additionally, Wolverine announced a strategic shift in its international management structure, leading to the departure of Isabel Soriano, President of the International Group. This move aims to align the company’s global operations more closely with its key brands, Merrell and Saucony. The company has entered into a settlement agreement with Soriano, including a cash payment and non-compete covenants. These changes reflect Wolverine’s commitment to its turnaround plan and operational improvements.
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