UPDATE: Imperial Capital Downgraded Crocs After Earnings

In a report published Thursday, Imperial Capital analyst Lee Giordano downgraded

from Outperform to In-Line and lowered the PT from $17 to $14. Imperial Capital commented on the lower earnings forecast due to a lull in North American business and the lack of a near-term catalyst. Giordano wrote, "Nevertheless, we believe downside risk to the shares should be limited, reflecting a newly announced increase to its share repurchase authorization (20% of the shares outstanding) as well as healthy growth trends in Asia Pacific and Europe, and the prospect of easier compares in 2014 from improved spring weather trends and the anniversary of FX pressures." Crocs, Inc. reported Q3 EPS of $0.18 versus analyst's estimate of $0.19 and consensus of $0.17. Revenue was $288.50M, down 2.4%. Imperial Capital estimated $291M and consensus of $292M. Although Europe had a 60.5% gain in sales, the analyst reported that wholesale sales declined 6.2%. The Americas were down 18.6% and Japan down 11%. Imperial Capital blamed the "increasingly difficult macroeconomic environment" and believes upcoming spending patterns are likely to remain the same. Internet sales were also reported to be down 12.8%. Giordano commented on additional risk factors for Crocs include global economic weakness, highly competitive footwear industry, difficulty expanding product lines, third party manufacturers, and exposure to foreign currencies. The analyst added that "Crocs relies on a small number of suppliers to source certain materials used to manufacture Croslite. The ability to source these in times of rising costs could prove difficult." Crocs announced that the board is planning to repurchase 15M shares of stock for approximately 17.8M, or 20% shares outstanding. Crocs closed at $13.04 on Wednesday and closed at -6.56% today.