Having since discontinued apparel, accessories and its golf units, Crocs is now transitioning its focus toward its famous molded and casual styles. Sterne Agee CRT analyst Sam Poser said this will lead to less out-of-stock situations as well as help prevent against excess inventory. The company will also start delivering its spring product earlier in warm-weather climates and cut back its store fleet. After closing 114 stores last year, 65 more are on the chopping block for 2015.
"A strong management team with a footwear background is finally in place, the product mix is becoming more focused and compelling, and systems and processes are improving," Poser wrote in a note to investors last week.
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The brand is also stepping up its advertising with the new #Findyourfun campaign, which launched in March.
Still, the company's turnaround comes with challenges. Although Crocs earned 5 cents a share on an adjusted basis in the first quarter, total revenue declined by $50 million, or 16.1 percent. Analysts attributed the drop to a stronger dollar, weakness in China, West Coast port delays and fewer stores.
But despite these headwinds, Poser remains confident in the brand's potential.
"Based on our industry checks, the Crocs brand still holds value, and retailers are going to meaningfully step up their orders on the new product," he said.