Skechers Usa (NYSE:SKX)

We are removing SKX from the GeoSpecial list @ $43.70. The Stock has increased 59.5% from our initial call to where the P/E multiple is now in line with future growth rate. Investors with a high risk appetite may consider $53 a legitimate price target, which would give SKX a trailing P/E of 25.

Added to the GeoSpecial list  on January 12, 2010 @ $27.40

Catalyst: Stock traded down despite reporting great EPS results and exceeding estimates.

Peak performance: Reached a high of  $ on .
Current road block: EPS comparisons will start to become more challenging.
Current Price: $43.70

"With strong April sales in our wholesale and international business, double digit retail store comps, accelerating backlog, and the addition of 20 to 25 more retail stores in the United States and in new markets in Europe this year, we believe our momentum will continue throughout the year. More new relevant men’s, women’s and kids’ product will also be delivering for back to school in June and July, which can result in a shift in revenue between the second and third quarters," Mr. Weinberg added. "We are well-positioned for growth in 2010 and beyond with clean inventory, a cash position of $326 million at quarter end, and a new, more efficient, 1.8 million-square-foot distribution center in Rancho Belago, California in development."

The GeoTeam® is coding Skechers ($27.40) as a short-term GeoSpecial trading opportunity.  The company is down sharply today after issuing a bullish fourth quarter EPS forecast of $0.50, which significantly exceeds analyst estimates of $0.19. We are postulating that this is a case of a buy the rumor sell news scenario and that, eventually as the dust settles, investors may scoop up beaten down shares which have been in a strong uptrend.  We have coded SKX only as a short-term opportunity since the company:

• Has not provided its outlook for 2010.
• Has had a tendency to report wide variations in EPS.