Sketchers (SKX)

**vik589** Sat Aug 11, 2007 6:02 pm

Sketchers (SKX)
Hello Blast,
Have you looked at sketchers recently. It seems to be down quite a bit (47%) from its recent highs...i guess this is due to a mixture of a bad quarter and the recent panic selling in the market. Sales have been on the rise consistently for the past 4 years. The company has introduced new fashion and street brands (Zoo york, Cali, Cali gear, Avirex). Also sketchers is expanding into foreign markets (Europe and Japan). Do you see any value in this one at current price? Would like to know your take on this....thanks in advance.

**xuedong_zhang** Fri Nov 16, 2007 11:10 am

Re: Sketchers (SKX)
I remember lzhang had a article on this, I cannot find it now?
did someone delete it, or lzhang think the fundamental has changed?

The cost in China is rising quickly, as we may all know through family members in china.
This will definitely cut the margin of SKX etc. So the growth rate of SKX and others enjoyed past 10-15 years may gone in next couple of years.

vik589 wrote: Hello Blast,
Have you looked at sketchers recently. It seems to be down quite a bit (47%) from its recent highs...i guess this is due to a mixture of a bad quarter and the recent panic selling in the market. Sales have been on the rise consistently for the past 4 years. The company has introduced new fashion and street brands (Zoo york, Cali, Cali gear, Avirex). Also sketchers is expanding into foreign markets (Europe and Japan). Do you see any value in this one at current price? Would like to know your take on this....thanks in advance.

**blast_investor** Fri Nov 16, 2007 12:11 pm

vik589:
I don't know that much on retail apparrel footwear sector that much.

xuedong_zhang:

From the numbers, Skechers has pretty reasonable low price to earning ratios and its recent Q earning is getting better. This company does not appears to have cost pressure and its profit margin was pretty high in recent Q.

**lzhang** Fri Nov 16, 2007 12:31 pm

Re: Sketchers (SKX)
What is the budget for a typical American family to buy footwear or clothing? What is the percentage for that compared to other expenses? Not a big deal. Actually footwear retailer price keeps rising constantly in recent years. I do not think people buy less shoes just for that matter. American people are not that poor yet, even other people outside the US (for example, China) are getting richer.

Do you consume less salt or matches just because of the price increase? If the salt price hikes 50% or even 100%, you are not going to consume less.

Footwear is a small part of people's budget. I do not think economic slowdown or spending slowdown would be a huge problem for footwear makers.

All that change are people's expectation. When people think there is a bright future, they bid up the price; when people think there is no future so that people just stop buying any shoes, they bid down the price.

xuedong_zhang wrote: I remember lzhang had a article on this, I cannot find it now?
did someone delete it, or lzhang think the fundamental has changed?

The cost in China is rising quickly, as we may all know through family members in china.
This will definitely cut the margin of SKX etc. So the growth rate of SKX and others enjoyed past 10-15 years may gone in next couple of years.

**xuedong_zhang** Fri Nov 16, 2007 12:46 pm

Re: Sketchers (SKX)
I am not sure other people's attitude to expense on footwear.

I am mid income people. I feel I will be definitely affected by the budget I have. Usually I don't have a hurry for a footwear, since
shoes usually last for quite some time and I had enough to put on my foot.

I will be encourage to buy footwear when 1) there is discount going on 2) holiday shopping when I think I can reward myself.

This maybe even more true for women's fashion shoes.
People may not sensitive to the hike of the shoe price, but I think people are sensitive of whether they feel rich or not.

It is a little bit different from the food, which you consume everyday. I have more than enough clothes and shoes accumulated during past years :)

lzhang wrote: What is the budget for a typical American family to buy footwear or clothing? What is the percentage for that compared to other expenses? Not a big deal. Actually footwear retailer price keeps rising constantly in recent years. I do not think people buy less shoes just for that matter. American people are not that poor yet, even other people outside the US (for example, China) are getting richer.

Do you consume less salt or matches just because of the price increase? If the salt price hikes 50% or even 100%, you are not going to consume less.

Footwear is a small part of people's budget. I do not think economic slowdown or spending slowdown would be a huge problem for footwear makers.

All that change are people's expectation. When people think there is a bright future, they bid up the price; when people think there is no future so that people just stop buying any shoes, they bid down the price.

xuedong_zhang wrote: I remember lzhang had a article on this, I cannot find it now?
did someone delete it, or lzhang think the fundamental has changed?

The cost in China is rising quickly, as we may all know through family members in china.
This will definitely cut the margin of SKX etc. So the growth rate of SKX and others enjoyed past 10-15 years may gone in next couple of years.

**xuedong_zhang** Sat Nov 24, 2007 2:48 pm

Re: Sketchers (SKX)
Want to buy a pair of shoes for my son. Sketchers are not bad,
but my wife insist on stride rite, brand names do talk :(

xuedong_zhang wrote: I am not sure other people's attitude to expense on footwear.

I am mid income people. I feel I will be definitely affected by the budget I have. Usually I don't have a hurry for a footwear, since
shoes usually last for quite some time and I had enough to put on my foot.

I will be encourage to buy footwear when 1) there is discount going on 2) holiday shopping when I think I can reward myself.

This maybe even more true for women's fashion shoes.
People may not sensitive to the hike of the shoe price, but I think people are sensitive of whether they feel rich or not.

It is a little bit different from the food, which you consume everyday. I have more than enough clothes and shoes accumulated during past years :)

lzhang wrote: What is the budget for a typical American family to buy footwear or clothing? What is the percentage for that compared to other expenses? Not a big deal. Actually footwear retailer price keeps rising constantly in recent years. I do not think people buy less shoes just for that matter. American people are not that poor yet, even other people outside the US (for example, China) are getting richer.

Do you consume less salt or matches just because of the price increase? If the salt price hikes 50% or even 100%, you are not going to consume less.

Footwear is a small part of people's budget. I do not think economic slowdown or spending slowdown would be a huge problem for footwear makers.

All that change are people's expectation. When people think there is a bright future, they bid up the price; when people think there is no future so that people just stop buying any shoes, they bid down the price.

xuedong_zhang wrote: I remember lzhang had a article on this, I cannot find it now?
did someone delete it, or lzhang think the fundamental has changed?

The cost in China is rising quickly, as we may all know through family members in china.
This will definitely cut the margin of SKX etc. So the growth rate of SKX and others enjoyed past 10-15 years may gone in next couple of years.