On Thursday, Wolverine World Wide (NYSE:WWW) received an updated assessment from Williams Trading, which shifted its rating from Sell to Hold. The firm also increased its price target for the company's shares to $11.00, up from the previous $7.50. The revision comes ahead of the company's first-quarter earnings report for 2024, which is scheduled to be released before the market opens on Wednesday, May 8th.
The upgrade is attributed to a more positive outlook on Wolverine's Saucony brand, with sales now anticipated to decline approximately 15% for the year, an improvement from the earlier forecast of a 22% drop. This adjustment is based on recent proprietary checks that have led to a more constructive view of the business. Despite this, the company's guidance still predicts a revenue decrease in the mid-30% range for the first quarter and in the low-20% range for the full year of 2024.
Saucony's performance has been bolstered by the success of its high-end running shoes, the Endorphin Elite and Endorphin Pro 4, which are seeing strong sales in specialty running stores. Additionally, the retro Grid Pro Grid Omni 9 and other vintage styles are gaining traction within fashion and athletic fashion retailers. The increased interest in these retro products has prompted more orders for the fall of 2024, suggesting that Saucony's annual sales could outperform current company guidance.
Despite the positive developments with the Saucony brand, Williams Trading maintains a cautious stance on other Wolverine brands, such as Merrell and the Work brands. The firm notes that while the retro trend is contributing to a brighter sales outlook for Saucony, it is uncertain how long-lasting this trend will be, warranting a degree of caution.
InvestingPro Insights
As Wolverine World Wide (NYSE:WWW) prepares for its upcoming earnings report, the latest data from InvestingPro provides a mixed picture of the company's financial health. With a market cap of $835.07 million and a high EBITDA valuation multiple, investors are observing the company's performance closely. The InvestingPro Tips suggest that while the net income is expected to grow this year, analysts anticipate a sales decline in the current year, aligning with the cautious outlook from Williams Trading.
Despite the expected decline in revenue, the company's stock has shown resilience with a strong return over the last three months, boasting a 23.03% price total return in that period. Moreover, the company has maintained dividend payments for 37 consecutive years, offering a dividend yield of 3.83%, which could be appealing for income-focused investors. For those seeking more detailed analysis and additional insights, InvestingPro offers a plethora of tips, including 6 more tips for WWW, which can be accessed at https://www.investing.com/pro/WWW. To enrich your investment strategy, consider using the coupon code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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