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Wolverine World Wide shares slump after weakness in the Sperry brand

Tonya Garcia

Wolverine World Wide Inc. shares slumped 4.5% in Friday trading after the company reported weakness in its Sperry brand. Other brands in the Wolverine portfolio include Merrell, Saucony and Keds. Net income for the first quarter totaled $40.6 million, or 43 cents per share, down from $46.6 million, or 48 cents per share, last year. Adjusted EPS of 49 cents, was ahead of the 47-cent FactSet consensus. Sales totaled $523.4 million, down from $534.1 million and below $533.0 million FactSet expectation. "Four of our top-five brands delivered revenue above plan during the quarter, including Merrell and Saucony, and our owned e-commerce business continued to be robust, growing 28% over the prior year," said Blake Krueger, Wolverine's chief executive, in a statement. "This strength helped to offset some unforeseen challenges at Sperry and the late start to Spring which impacted certain product categories." Analysts are bullish, notwithstanding the miss. "Despite back-end weighted guidance, we are confident Wolverine will achieve top- and bottom-line FY19 objectives," wrote Susquehanna Financial Group analysts. "Headwinds faced in the first half should subside in second half." Susquehanna rates Wolverine shares positive, but lowered its price target to $41 from $43. Wolverine still expects revenue in the range of $2.28 billion to $2.33 billion, EPS between $2.00 and $2.15, and adjusted EPS between $2.20 and $2.35. FactSet expects revenue of $2.30 billion and EPS of $2.31. Wolverine stock has fallen 5% for the year to date while the S&P 500 index is up 13% for the period.