Wolverine’s Brand Strength (WWW) and Customer Earnings in Ecommerce Support – September 23, 2021

A diverse global business model, immense brand strength, and strong digital capabilities help Wolverine Worldwide, Inc. (WWW Free Report) to navigate turbulent times. Big business brands like Merrell and Saucony have been standing out for some time. Constant innovations and product launches are additional positive points. It is constantly strengthening digitization to improve product flow in addition to strengthening its distribution centers. Shares of the Rockford, MI-based company are up 31.5% in a year compared to its industry’s 29.6% rally.

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Among Wolverine’s sales channels, e-commerce is a constant key driver. The company is leveraging the larger investments in digital marketing to increase traffic and focusing more on better merchandising to optimize conversion. It expands digital content and information flow as well as better management of its consumer database. The solid growth of brands’ websites also adds to the overall digital performance.

Wolverine’s Direct-to-Consumer (DTC) channels have been strong for some time now. Company-owned e-commerce revenue more than doubled in the first half of 2021 compared to the same period in 2019. Company-owned e-commerce revenue increased 90.7% from the 2019 count. As of Q2 2021, total DTC revenue jumped 17.5% year-over-year and 68.8% from 2019 level. From a brand perspective, saucony.com has Growing over 20% while Merrell.com’s revenue has climbed over 150% year over year.

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The company is focused on improvising brands that meet consumer preferences with cutting edge technology and accurate market information. It remains committed to its latest innovations and launches in various brand banners and presents a strong pipeline of new products. Management is on the right track with the launch of its first Merrell mobile app. In addition, the company is focused on growth in all performance product categories, including hiking, running and work.

Additionally, Wolverine’s international business, which includes an extensive network of global partners, continues to be impressive. Saucony stores and technical staples perform impressively in China as the brand’s joint venture activities ramp up. In addition, the Company’s EMEA market continues to show strength and represents a significant growth opportunity. The company’s Merrell brand also has potential for global growth, primarily in the EMEA region.

Wrap

The aforementioned strategies should keep Wolverine’s strong momentum going going forward. Management anticipates significant growth in 2021 from 2020 and 2019 levels, driven by accelerating demand for its brands. Robust products, impressive merchandising practices and healthier inventory positions are likely to fuel growth. For 2021, the company forecast revenue in the $ 2,340-2,400 million range, suggesting 31-34% growth from the 2020 reading and a 5.6% increase from actual numbers. of 2019 at the higher end of the range. Adjusted earnings per share are seen in the $ 2.20 to $ 2.30 range, indicating growth from the 93 cents reported in 2020.

Zacks’ consensus estimate for 2021 sales and earnings is currently set at $ 2.46 billion and $ 2.31 per share, respectively. These estimates imply a corresponding growth of around 37% and 148% compared to the respective figures published a year ago. The company’s earnings status looks pretty good as the metric has beaten Zacks’ consensus estimate in each of the past four quarters, averaging 23%. An expected long-term earnings growth rate of 10% for this currently ranked 2 (Buy) stock from Zacks further adds to its appeal.

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