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Rocky Shoes Buy rating maintained in update through Dutton
17 Aug '05
3 min read
Largest issuer-paid equity research firms Dutton Associates updates its coverage of outdoor gear online store Rocky Shoes & Boots maintaining a Buy rating and a $38.00 price target. The 8-page report by Dutton senior analyst Jon Ziegler, CFA is available at www.jmdutton.com as well as from First Call, Bloomberg, Zacks, Reuters, and other leading financial portals.
Footwear company Rocky's second quarter ended June 30, 2005, representing another quarter of substantial sales and earnings growth benefiting from the acquisition of EJ Footwear in January of this year. Sales were up 139 percent to $65.5 million and EPS were up to $0.50 per share from $0.29 a year ago. While reported EPS were slightly below the estimate of $0.53, they note that operating income actually exceeded projection with a reported operating margin of 9.52 percent vs. Company 9.15 percent projection, and up from 8.67 percent a year ago.
The EPS shortfall was strictly a result of higher-than-expected interest expense, which was a result of the debt incurred to finance the acquisition of EJ Footwear.
Rocky's business is currently being driven by multifaceted opportunities. The Company is adding new product lines, reinforcing existing lines, adding new channels of distribution and reinforcing existing channels of distribution.
They believe such programs can have a multiplier effect, viz new products going through new channels should drive impressive sales growth. They continue the estimate of $2.60 per share for 2005 and are using a preliminary estimate of $2.77 for 2006.
Footwear company Rocky's second quarter ended June 30, 2005, representing another quarter of substantial sales and earnings growth benefiting from the acquisition of EJ Footwear in January of this year. Sales were up 139 percent to $65.5 million and EPS were up to $0.50 per share from $0.29 a year ago. While reported EPS were slightly below the estimate of $0.53, they note that operating income actually exceeded projection with a reported operating margin of 9.52 percent vs. Company 9.15 percent projection, and up from 8.67 percent a year ago.
The EPS shortfall was strictly a result of higher-than-expected interest expense, which was a result of the debt incurred to finance the acquisition of EJ Footwear.
Rocky's business is currently being driven by multifaceted opportunities. The Company is adding new product lines, reinforcing existing lines, adding new channels of distribution and reinforcing existing channels of distribution.
They believe such programs can have a multiplier effect, viz new products going through new channels should drive impressive sales growth. They continue the estimate of $2.60 per share for 2005 and are using a preliminary estimate of $2.77 for 2006.
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