| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 79.50 | 26 |
| Intrinsic value (DCF) | 35.18 | -44 |
| Graham-Dodd Method | 37.00 | -41 |
| Graham Formula | 63.50 | 0 |
Skechers U.S.A., Inc. (LSE: 0L73.L) is a leading global footwear company specializing in casual, athletic, and performance footwear for men, women, and children. Headquartered in Manhattan Beach, California, Skechers operates through three key segments: Domestic Wholesale, International Wholesale, and Direct-to-Consumer. The company offers a diverse product portfolio under brands like Skechers USA, Skechers Sport, BOBS, and performance lines such as Skechers GOrun and GOwalk. With over 4,300 company-owned and third-party stores worldwide, Skechers leverages a multi-channel distribution strategy, selling through department stores, specialty retailers, e-commerce platforms, and its own branded stores. The company’s focus on comfort, innovation, and affordability has positioned it as a strong competitor in the global footwear market, particularly in lifestyle and performance categories. Skechers also licenses its brand and has expanded into lifestyle apparel, further diversifying its revenue streams. As a key player in the consumer cyclical sector, Skechers benefits from strong brand recognition and a growing international presence, particularly in emerging markets.
Skechers presents a compelling investment case with its strong brand equity, diversified product portfolio, and global expansion strategy. The company’s revenue of $8.97 billion (FY 2024) and net income of $639.5 million reflect solid operational performance. Skechers’ lack of dividend payouts suggests reinvestment in growth, particularly in international markets and direct-to-consumer channels. However, investors should consider risks such as high competition in the footwear industry, exposure to fluctuating consumer demand, and a debt load of $1.93 billion. The stock’s beta of 1.065 indicates moderate volatility relative to the market. The company’s capital expenditures ($416.8 million) highlight ongoing investments in retail expansion and supply chain efficiency, which could drive long-term growth but may pressure short-term cash flows.
Skechers competes in the highly fragmented global footwear market by emphasizing comfort, affordability, and broad distribution. Its competitive advantage lies in its diversified product range, spanning casual, athletic, and performance footwear, which allows it to cater to multiple consumer segments. The company’s strong wholesale and direct-to-consumer channels provide resilience against retail disruptions. Skechers’ international expansion, particularly in Asia and Europe, differentiates it from competitors reliant on North American markets. However, it faces intense competition from premium brands (e.g., Nike, Adidas) and value-oriented players (e.g., Decker’s Hoka). Skechers’ lack of a strong professional sports endorsement portfolio limits its appeal in high-performance categories compared to rivals. Its focus on comfort and lifestyle footwear, however, resonates with casual and older demographics. The company’s vertically integrated supply chain and licensing strategy provide cost efficiencies and brand extension opportunities. While Skechers lacks the premium pricing power of luxury brands, its mid-tier positioning allows for broader market penetration.