SKX gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 45 industry peers in the Textiles, Apparel & Luxury Goods industry. SKX scores excellent on profitability, but there are some minor concerns on its financial health. SKX is not valued too expensively and it also shows a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

SKX had positive earnings in the past year.
In the past year SKX had a positive cash flow from operations.
SKX had positive earnings in each of the past 5 years.
In the past 5 years SKX always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of SKX (7.17%) is better than 81.63% of its industry peers.
Looking at the Return On Equity, with a value of 13.94%, SKX is in the better half of the industry, outperforming 67.35% of the companies in the same industry.
SKX has a Return On Invested Capital of 9.63%. This is in the better half of the industry: SKX outperforms 65.31% of its industry peers.
SKX had an Average Return On Invested Capital over the past 3 years of 10.44%. This is in line with the industry average of 11.59%.

		Industry Rank	Sector Rank
ROA	7.17%
ROE	13.94%
ROIC	9.63%

ROA(3y)6.74%

ROA(5y)6.66%

ROE(3y)12.99%

ROE(5y)13.14%

ROIC(3y)10.44%

ROIC(5y)8.75%

1.3 Margins

SKX has a better Profit Margin (7.07%) than 83.67% of its industry peers.
SKX's Profit Margin has been stable in the last couple of years.
With a decent Operating Margin value of 8.89%, SKX is doing good in the industry, outperforming 73.47% of the companies in the same industry.
SKX's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 52.67%, SKX is in line with its industry, outperforming 59.18% of the companies in the same industry.
In the last couple of years the Gross Margin of SKX has grown nicely.

		Industry Rank	Sector Rank
OM	8.89%
PM (TTM)	7.07%
GM	52.67%

OM growth 3Y2.07%

OM growth 5Y0.3%

PM growth 3Y-15.34%

PM growth 5Y1.43%

GM growth 3Y2.39%

GM growth 5Y2.18%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

SKX has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for SKX has been reduced compared to 1 year ago.
The number of shares outstanding for SKX has been reduced compared to 5 years ago.
SKX has a worse debt/assets ratio than last year.

2.2 Solvency

SKX has an Altman-Z score of 3.63. This indicates that SKX is financially healthy and has little risk of bankruptcy at the moment.
SKX has a better Altman-Z score (3.63) than 67.35% of its industry peers.
The Debt to FCF ratio of SKX is 9.25, which is on the high side as it means it would take SKX, 9.25 years of fcf income to pay off all of its debts.
SKX's Debt to FCF ratio of 9.25 is in line compared to the rest of the industry. SKX outperforms 42.86% of its industry peers.
A Debt/Equity ratio of 0.06 indicates that SKX is not too dependend on debt financing.
SKX's Debt to Equity ratio of 0.06 is amongst the best of the industry. SKX outperforms 83.67% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.06
Debt/FCF	9.25
Altman-Z	3.63

ROIC/WACC0.93

WACC10.4%

2.3 Liquidity

SKX has a Current Ratio of 2.09. This indicates that SKX is financially healthy and has no problem in meeting its short term obligations.
SKX has a Current ratio (2.09) which is in line with its industry peers.
A Quick Ratio of 1.29 indicates that SKX should not have too much problems paying its short term obligations.
The Quick ratio of SKX (1.29) is better than 63.27% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.09
Quick Ratio	1.29

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 17.43% over the past year.
SKX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.92% yearly.
The Revenue has grown by 12.11% in the past year. This is quite good.
Measured over the past years, SKX shows a quite strong growth in Revenue. The Revenue has been growing by 11.43% on average per year.

EPS 1Y (TTM)17.43%

EPS 3Y16.13%

EPS 5Y12.92%

EPS Q2Q%24.18%

Revenue 1Y (TTM)12.11%

Revenue growth 3Y12.44%

Revenue growth 5Y11.43%

Sales Q2Q%13.09%

3.2 Future

The Earnings Per Share is expected to grow by 9.23% on average over the next years. This is quite good.
SKX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.61% yearly.

EPS Next Y-9.59%

EPS Next 2Y-4.64%

EPS Next 3Y1.79%

EPS Next 5Y9.23%

Revenue Next Year7.85%

Revenue Next 2Y7.87%

Revenue Next 3Y6.66%

Revenue Next 5Y7.61%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 14.41, SKX is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of SKX indicates a somewhat cheap valuation: SKX is cheaper than 73.47% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.21, SKX is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 16.73, the valuation of SKX can be described as correct.
SKX's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 24.26. SKX is valued slightly cheaper when compared to this.

		Industry Rank	Sector Rank
PE	14.41
Fwd PE	16.73

4.2 Price Multiples

SKX's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. SKX is cheaper than 65.31% of the companies in the same industry.
63.27% of the companies in the same industry are cheaper than SKX, based on the Price/Free Cash Flow ratio.