(Bloomberg) — Skechers U.S.A. Inc. shares delivered their worst daily performance since February after the footwear company’s chief financial officer told an industry conference that China sales will be under pressure the rest of the year.
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Shares slipped 9.6% Thursday to close at $61.56, the lowest level since early August. Footwear peers including Nike Inc. and Under Armour Inc. saw their shares briefly dip on the comments, then rebound. The stock of competitor On Holding AG shed 2.4%.
“We’ve definitely seen worse conditions unfold in China than we expected for the back half of the year, so I would expect the back of the year’s going to be more disappointing than what we had originally thought,” said Skechers CFO John Vandemore at the Wells Fargo Consumer Conference. “I think that’s a market that’s still re-forming itself post Covid.”
China is a major market for global retailers, and concerns about the strength of Chinese consumer buying have long been a focus. The Asia Pacific region accounted for more than a quarter of Skechers’ sales in 2023, according to a filing.
Thursday’s slump put Skechers shares in negative territory for the year. Still, Wall Street is bullish on 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 where shares currently trade.
–With assistance from Janet Freund.
(Updates stock move at market close)
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