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Amid reports this morning that Sterne Agee downgraded Skechers USA Ltd.
SKX, the stock fell almost 8% during midday trading on Tuesday.
Sterne Agee said the inventory numbers are “particularly concerning given continued deceleration of sales in toning and indications that margins are already collapsing.”
Even though this shoe design is not new to the market, a marketing campaign last year catapulted Skechers to the forefront of the toning shoe market.
The original toning shoe was made by MBT (Masai Barefoot Technology), and are not as aesthetically pleasing as Skechers Shape Ups and are considerably more expensive, giving Skechers an edge in the market.
Reebok, the number one competitor for Skechers ShapeUps, has launched their EasyTone line which includes their own style of toning shoe along with a clothing line that claims to tone your body just by wearing their clothes.
Reebok uses a design different from the ShapeUps and the MBTs, but the whole situation boils down to: Do they really work?
Speaking for the bulls, Brooke Burke claims they do and just announced an endorsement deal with Skechers that will carry through until 2011.
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