Keith pings us with tickers each night that are standouts in his trade factor models. Tonight he said, "CROX looks awesome ... $2.27 TRADE support." That's the first time I've heard him use the word 'awesome' in months.
At $2.58 we're looking at an EV of $187mm. Yes, this has been a triple over the past two months. But I still find a major problem poking holes in my logic that the new CEO (or a strategic buyer who scoops up this company) could take CROX back to its roots, and takes the top line from the $847mm peak down to a core of $400mm and run at a 10% margin (I can defend this rate six ways til Sunday). That suggests about $43mm in EBITDA. With no store openings, Crocs can sustain itself on $10-15mm/yr in capex - so we're looking at about $25-$30mm in free cash. Not bad for 7x free cash with a call option on monetizing the Crocs brand above and beyond the current consensus view (or lack thereof).