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Investing.com - UBS has reduced its price target on Wolverine World Wide (NYSE:WWW) to $28.00 from $39.00 while maintaining a Buy rating on the footwear company’s stock. This comes as WWW shares have taken a significant hit, falling 27.46% over the past week and currently trading at $16.72.
The price target adjustment comes despite UBS’s continued confidence in Wolverine’s investment strategy for its Active brands, which the firm believes will drive sustainable sales and earnings per share growth. InvestingPro data shows the company is expected to grow net income this year, with analysts forecasting EPS of $1.34 for FY2025.
UBS highlighted Wolverine’s third-quarter earnings beat and Saucony’s strong 27% year-over-year sales growth as evidence that the company’s brand-building approach is yielding positive results.
The investment bank forecasts a 14% four-year earnings per share compound annual growth rate for Wolverine World Wide following fiscal year 2025, suggesting this growth potential remains undervalued at the current price-to-earnings ratio of 10 times fiscal year 2 estimates. According to InvestingPro, WWW currently trades at a P/E of 15.99 and appears fairly valued based on InvestingPro’s Fair Value assessment.
UBS expects earnings per share beats over the near term to drive Wolverine’s stock price toward the new $28 target, reinforcing the firm’s Buy recommendation despite market skepticism about the durability of the company’s growth trajectory. The company has maintained dividend payments for 38 consecutive years, currently yielding 2.39%, and shows a solid Piotroski Score of 7. Discover more insights with InvestingPro, which offers additional ProTips and comprehensive research reports for Wolverine World Wide and 1,400+ other US equities.
In other recent news, Wolverine World Wide reported third-quarter revenue of $470.3 million, surpassing both Stifel’s estimate of $466.6 million and the consensus forecast of $462.6 million. The company’s Active Brands segment showed strong growth, with Saucony and Merrell brands increasing by 24.9% and 3.5%, respectively, despite an 8.2% decline in the Wolverine brand itself. Stifel reaffirmed its Buy rating for the company with a price target of $36.00. Meanwhile, UBS raised its price target to $39.00, maintaining a Buy rating, citing strong performance in the Saucony and Merrell lines. Conversely, Williams Trading downgraded the stock from Buy to Hold, lowering its price target to $27.00 due to concerns over Saucony’s potential sales growth deceleration. In corporate news, Wolverine World Wide appointed Justin Cupps as the President of its Work Group, overseeing several of its work footwear brands. Additionally, the company declared a quarterly dividend of $0.10 per share, consistent with previous payments.
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