Skechers' Aggressive Investments Make It a Stock Worth Considering

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Nov 23, 2014

Skechers USA (SKX, Financial) recently reported robust results for the third quarter of fiscal 2014. The company saw a good improvement in sales, depicting a good market position of the brand. The company also delivered record revenues for the third consecutive quarter. Skechers is now focusing on sustaining this momentum. It is focusing on delivering cutting-edge products for every age group of customers. To attract more customers to its brand, Skechers is focusing on innovating its products from the fashion and comfort viewpoints. It is now focusing on various opportunities that it can explore to clock higher growth in the future.

Aggressive investments

Skechers is investing aggressively in global infrastructure to become more efficient. Under this, the company has also added a new distribution facility in Chile. It has also installed an automated system in its European distribution centre. This will help in smooth functioning and better delivery by the company. In addition, Skechers is also engaging some famous names to promote its products.

As a result, Skechers has recently announced the signing Ringo Starr, who is a famous drummer. Skechers is thinking that this association will boost sales in the men’s segment in 2015. Besides this, Skechers is also developing marketing campaigns targeting all age groups. For example, by using animated characters for kids to legendary sports figures such as Pete Rose, the company is trying to increase sales.

Moving on, Skechers is also investing in product development, marketing, and infrastructure with an objective of driving its growth momentum across the globe in many potential markets. Skechers is focusing on the upcoming holiday season and spring 2015. It has some new line ups in its product portfolio, which is expected to deliver strong results in its lifestyle, running, and walking categories.

Expansion plans

Skechers also has a strong expansion plan as well. It is expanding its retail segment and is opening another 10-15 company owned stores. Seeing good traction in the international markets, Skechers is also opening 35-40 stores through its international franchise partners. To spread its wings in the international market, it is also opening a new distribution facility in Chile. With its robust product development and advertising initiatives, Skechers looks well positioned for better times ahead.

In the coming quarters, Skechers is going to launch Skechers GO Run 4, accompanied by a marketing campaign. Its brand ambassadors Meb and Kara will both race in the event in the starting of the next month. The company thinks that it will support its products and will help its new products to gain traction in the coming holiday season.

Conclusion

Evidently, Skechers is moving in the right direction. The company is undertaking aggressive investment measures. As a result, its growth should improve in the long run, which is the reason why investors should hold on to this stock.