Wolverine World Wide's Re-energization Is On Track

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In a report published Monday, Stifel analyst Jim Duffy upgraded the rating on Wolverine World Wide, Inc. WWW from Hold to Buy, while establishing a price target of $34.

Analyst Jim Duffy said that the main reasons for the upgrade were the “favorable view of risk/reward” as well as encouraging signs for key brands and margins looking into next year. Duffy believes that Wolverine World Wide’s shares had found a “foundation of support” and that earnings could return to double-digit growth in 2016.

In the report Stifel noted, “Recent meetings at the Outdoor Retailer show give us reason for optimism looking into 2016 for Merrell, Sperry, (the two largest brands - combined nearly 40% of revenue) and international (~30% of revenue, higher percentage of pair volume).”

Duffy expressed optimism regarding improved results in 2016, citing the following:

  • Merrell – It had new leadership, “thoughtful product platforms,” and was adopting a more youthful approach to lifestyle product.
  • Sperry - New products outside of core boat styles, along with early signs of robust Spring orders.
  • International – “…we expect high single digit or better constant currency revenue growth behind building momentum for acquired brands (notably Sperry, Saucony and Keds) and product lines developed to support distributors in markets challenged by FX.”
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Posted In: Analyst ColorUpgradesAnalyst RatingsStifel
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