(Bloomberg) — Shares of Skechers USA Inc. posted their worst daily performance since February after the footwear company's chief financial officer told an industry conference that sales in China will be under pressure for the rest of the year.
Most read on Bloomberg
Shares fell 9.6% on Thursday, closing at $61.56, the lowest level since early August. Shares of similar footwear companies such as Nike Inc. and Under Armour Inc. briefly fell after the comments but then rebounded. Shares of competitor On Holding AG fell 2.4%.
“We’ve definitely seen worse conditions in China than we expected for the second half of the year, so I think the end of the year will be more disappointing than we had originally thought,” John Vandemore, chief financial officer of Skechers, said at the Wells Fargo Consumer Conference. “I think it’s a market that’s still reshaping itself post-COVID.”
China is an important market for global retailers and concerns about the strength of Chinese consumer purchasing have long been a focus. The Asia Pacific region accounted for more than a quarter of Skechers’ sales in 2023, according to a report.
Thursday's drop left Skechers shares in negative territory for the year. Still, Wall Street remains optimistic about the company.
Wall Street analysts give Skechers 17 buy ratings and one hold, according to data compiled by Bloomberg. The average price target of about $81 is more than 30% higher than the current stock price.
–With the assistance of Janet Freund.
(Updates stock movement at market close)
Most read from Bloomberg Businessweek
©2024 Bloomberg LP
