Share to Twitter Share to Linkedin I first made Skechers USA SKX a Long Idea in April 2016 and closed the position in March 2018 to lock in its 5% outperformance of the S&P 500. Shortly thereafter, I made the stock a Long Idea again in May 2018. Since then, the stock is up 29% compared to a 53% gain for the S&P 500. The stock still presents excellent risk/reward and could be worth $70+/share today – a 79%+ upside. Skechers’ Stock Has Strong Upside Based on: the company’s large physical store footprint consistent market share gains large scale advantages the company enjoys as the third largest global footwear brand ability to reach its niche market with comfort and value current valuation of the stock implies profits will permanently fall 20% below current levels. Figure 1: Long Idea Performance: From Date of Publication Through 5/2/2022 What’s Working Stores Drive Growth: Skechers operates a wholesale business … [Read more...] about Disciplined Growth Makes Skechers USA A Quality Holding
Digital disruption wholesale
Share to Twitter Share to Linkedin Nearly every company is increasing its investment in technology and attempting to create new competitive advantage by assembling technology into platforms that transform how they serve their customers, service their employees, and coordinate their supply chains. Platforms automate existing activities and functions, fundamentally changing how leaders run an organization. Platforms cut across traditional organizational boundaries, incorporating many departmental functions, thus forcing a restructuring of process, organization, and technology. That creates a real challenge for organizations. Platforms automate existing activities and functions. Companies use their platforms broadly to both compete and run the organization. Digital platforms emerged when companies recognized they could dramatically improve customer or user experience by increasing the level of automation to achieve desired end-to-end process results. … [Read more...] about Engineering Challenges For Technology Platforms
Share to Twitter Share to Linkedin An important cryptocurrency collapsed last week and the fallout is having far-reaching effects on stocks, bonds and other risk assets. Unfortunately, this is only getting started. Terra Luna LUNA , the digital coin in the Terra ecosystem, crashed last week to near zero, a stunning fall from $67.64 a week ago. Luna was supposed to underpin UST UST , a stablecoin algorithmically pegged at one U.S. dollar. When the UST peg broke, panic ensued. Investors sold risk assets of all stripes. For many investors this contagion effect feels like déjà vu. The Russia and Asia currency crises of the 1990s roiled markets and wiped out fortunes. The news seemed to come out of nowhere then everything suddenly went off the rails as investors learned about exposure at money center banks in the United States and in Europe. A cryptocurrency inspired contagion has the potential to be much worse. Crypto has become a substantial … [Read more...] about Crypto’s LUNA Catastrophe Threatens Conventional Assets
Share to Twitter Share to Linkedin Fiscal policy and spending, inflationary pressures, combined with the recovery from the COVID-19 pandemic recession, resulted in our current overheating economy that demands a larger workforce. Combine that demand with the multi-year global talent shortage plus the social dynamics of the “Great Resignation” and early retirements post-COVID. This adds up to far more than a short-term staffing and attrition dilemma. At Everest Group, we have studied this situation and what it means for short-term and long-term business concerns. Read on to discover the reality of what’s ahead. Short-Term Situation Some companies have a thesis that the monetary policy will tighten, the inflation will slow, the work environment (whether from home, in the office, or a hybrid model) will work itself out, and the talent markets will resume their historical capacity. They hope the current challenging situation passes quickly. Under this … [Read more...] about Short-Term And Long-Term Picture Of Talent Shortage
Share to Twitter Share to Linkedin Our theme of EV Supplier stocks has underperformed this year, declining by about 20% year-to-date, compared to the S&P 500 which is down by about 16% over the same period. The decline comes as investors rotate out of futuristic themes and higher multiple stocks, amid rising interest rates and tighter monetary policy by the U.S. Federal Reserve. That being said, demand for electric vehicles has remained robust, driven by surging gasoline prices (up by around 25% year-to-date) and continued government support. For perspective, sales of plug-in electric vehicles in the U.S. rose by almost 60% year-over-year in Q1 2022 to around 160,000 units, compared to the broader auto market which contracted by about 18% year-over-year due to supply chain constraints. Now the near-term outlook for EV supplier stocks could be mixed. While we expect EV demand to hold up, there are concerns that the U.S. could be headed for a recession, … [Read more...] about EV Demand Is Surging. Why Are Suppliers Underperforming?