$CROX - 2Year Outlook - It's a buy

2022年4月9日

Let me start off saying that i hate Crocs and i will never own a pair, but i recognize that other people like them and in a way Crocs can be considered the new age Sandal.


The Juice
I'm no expert at any of this, but even i can see that Crox is undervalued by A LOT. Their recent acquisition of HEYDUDE shoes that costed them 2B in debt is what seems to have attracted plenty of small time sharks like Loop Capital that are known for telling investors to sell their GameStop shares as it was supposedly worth $10 and quoting Anthony Chukumba from Loop Capital on CNBC: "Sell now, think later".

Needless to say, yes, a little debt has attracted wallstreets' ugly side to this company. Sharks see debt, they see an opportunity for busting a company out on the long term by spreading lies and short and distort tactics like slashing CROX stock price from $180 to a $80 recently. All that just for a little debt that'll be paid off in 2 years since CROX is extremely profitable (35% profit margin) and can easily handle this debt (and they know it, hence why they even did this acquisition).

Multiple insiders have actually bought CROX stock in April (about 4 of them) all around the price of $76 indicating that even they think this is a dip. The last time insiders bought their own dip was in 2020 March when Corona hit and all stocks dived. This shows that the CROX insiders are "trading savvy" bastards. The insiders buying wasn't just a disposal/exercise/tax thing either, it was pure code "P" purchases and i re-iterate that multiple insiders bought the stock.

The signals
The 5 year MACD & RSI indicate that the ~70 ish area is a good buy and the stock's fundamentals more than support this idea. What doesn't support this is Loop Capital coming out batting with their $80 PT indicating that they have more in store for CROX short and distory until the HEYDUDE acqquisition goes through.

I consider Loop Capital to be a scum tier hedgefund. They aren't even predators, they are scavengers. My hopes are that they are here only for the short term gains to be made by using CROX 2Bn acquisition debt as the excuse, maybe they'll use other tactics, but in the end CROX is not just a profitable company, but an extremely profitable company.

No one is paying attention to CROX because it's ugly rubber molded shoes, and that's why i'm long at $70 and i'm continuing to build my position. Somehow, CROX is a thing and they make money, it's ridiculous, but if i sit and think about it, i can kinda understand it... there are people out there (more than i'd think...) that wear this in my opinion trash... and that's it... people wear Crocs. I made fun of Crocs as being a bit of a "meh" thing to wear to a Russian colleague and he thought Crocs were ok, i guess there's lots of people out there like him...

Other info
There are no other signals that i'm aware of, there is no squeeze, no high SI, no hidden shorts, nothing too weird going on here. The only funky thing about this is that CROX had a big dump from November 22 2022 until recently and that dump is the same dump the entire retail sector & retail ETFs have felt. You'll see the same dump on almost all of retail except bigger stocks like Jeff Amazon's stock. Even GME had the same dump as well as XRT and many many others.

I'd love to believe that this is a sector-wide short so that big boys can buy in on retail at low prices before what might be the next retail sector mega pump since supposedly Covid19 is suddenly "over". A big irrational short before buying in is something i've seen happen a few times on single stocks, but never sector-wide.

Again, this is another one of the many reasons i've bought in on CROX at $70 and consider it a long term play (2-4 years). I'm secured for another dump in case Loop Capital and other scavengers try to spread fake news about the company or try to change sentiment. At the same time i've sold a few puts in the money, at the money and out of the money because i'm extremely bullish for CROX long term and think anyone betting against it is going to get burned.

I don't believe there's more downside to CROX beyond what could be caused by another market correction. The insiders believe $76 is a strong buy and they've never been wrong, so yeah... get on the rubber shoes bandwagon today...