After Crocs (CROX, Financial) released a conservative earnings estimate for the next holiday quarter, but in early trade on Tuesday its shares have dipped 17.86%. Though its Q3 results exceeded analysts' projections for both income and earnings, the footwear company's downgraded Q4 expectations set off market questions. Crocs estimated Q4 earnings per share of $2.20 to $2.28, much below the consensus forecast of $2.72. Comparatively to previous year, the company forecasts income to be either flat or somewhat higher. Crocs' management blamed part of the uncertainty on problems with its HEYDUDE brand, which has had performance problems in a demanding operating environment.
"While we are seeing early green shoots from these actions, HEYDUDE's recent performance and the current operating environment are signaling it will take longer than we had initially planned for the brand to turn a corner," CEO Andrew Rees said in acknowledging these challenges on the earnings call. Rees underlined his belief in the long-term viability of the brand but also pointed out the importance of modifying the HEYDUDE full-year projection.
Crocs's robust Q3 performance was overshadowed by the disappointing direction, which caused a dramatic sell-off as investors responded to the brand's uncertainties and weaker holiday season expectations.Boeing (BA) shares dropped 2.6% in premarket tr
