Crocs said Thursday it agreed to buy Hey Dude for $2.5 billion. The company said it would pay $2.05 billion in cash and $450 million in Crocs shares issued to Hey Dude CEO Alessandro Rosano. The deal is expected to close in Q1 2022, Crocs said.
B. Riley said the deal would allow Crocs to further diversify out of clogs and into other casual products such as boat shoes and sneakers. The analysts noted that the casual footwear market is estimated to be worth around $125 billion, compared with $8 billion for the clog footwear market.
The analysts said they are still positive on Crocs shares due to strong demand for their core products and are estimating $1.00 per share in accretion to FY 2022 earnings per share due to the acquisition.
B. Riley has a buy rating and $174 price target on Crocs.
Price: 126.66, Change: +3.13, Percent Change: +2.53
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