10 Footwear Apparel Stocks Affected By China Tariffs

3. Crocs Inc. (NASDAQ:CROX)

Crocs Inc. is a casual lifestyle accessories and footwear developer, manufacturer, designer, marketer, and seller under HEYDUDE and Crocs brands. It offers a variety of footwear products including slides, boots, sandals, sneakers, clogs, flip-flops, and other products. The company sells its products through e-commerce sites, store-in-store locations, wholesalers, third-party marketplace, and retail stores.  The company sources 28% of its products from China.

CROX is down nearly 30% since reporting its Q3 earnings. Even though the company beat estimates on both revenue and EPS, it was the Q4 guidance that rattled investors. The lowered guidance by as much as 17% was mainly due to weakness in the HEYDUDE brand. Turning this brand around will take some time so weakness is expected. However, in the long run, there’s reason to believe management will handle the situation.

Crocs did a great job of handling the changing consumer tastes and trends during times of high inflation and back-to-office campaigns. Based on that evidence, investors should back the company to turn around HEYDUDE as well.

But if you’re a numbers guy, the growth story is in the international market. CROCS sales in the US have slowed down since 2022. During this time, its international growth has outpaced the local growth. It makes perfect sense for the company to explore other markets while it is facing pressures at home. If the international audience takes a liking to the company’s footwear, the growth potential is massive. It would be understandable though if investors want to wait for more evidence of international success before taking a position in the stock.