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What's with Crocs?



February 02, 2007 – Comments (3)

My CROX short in CAPS has been one of my big stinkers as my rating has PLUMMETED over the last couple weeks (and there are admittedly quite a few stinkers in my CAPS portfolio at the moment). However, most mystifying today was a 5.85% increase in CROX price -- to a new 52-week high, no less -- with the only real news I've seen being a licensing deal with Nickelodeon to make shoes featuring SpongeBob Squarepants and Dora the Explorer. Please tell me that's NOT the reason for a 5.85% price boost... but of course the AP has a headline that implies exactly that. (Well, and it also mentioned that an analyst "praised the company's momentum" and raised her price target.)

I guess this is the sort of thing that moved me to press underperform in CAPS on Crocs in the first place, but events like this one just make it seem more and more surreal...

3 Comments – Post Your Own

#1) On February 05, 2007 at 9:16 AM, TMFMileHigh (77.04) wrote:

That's because it is, Alyce ;-)

Crocs' management lives in a dream state. Recently, they spent $20 million for charms that fit into those silly holes in the shoes. Woo hoo!

The analysts have it right -- this is a pure momentum stock that sports zero competitive advantage. Hang on tight to that short call.

See you soon,


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#2) On February 05, 2007 at 8:28 PM, AbqLawyer (< 20) wrote:

Sponge Bob carries alot of weight with the under ten set - big spenders.

One analyst raised his/her price target to $80 - so if the analysts have it right . . .

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#3) On February 06, 2007 at 9:45 PM, TMFLomax (89.62) wrote:

Hey Tim -- lol, oh yeah, the charms! How could I forget those...

AbqLawyer, thanks for dropping in. I guess we shall see what happens with Crocs over the long term...

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