BABA - Crocs: Still Excelling But More Cautious On The Long Term

• Crocs is heading for a record year, aiming for $2B in revenues as margins improved dramatically for Q1, with +60-70% revenue growth for Q2.
• Previously identified catalysts like a quick Chinese recovery from the pandemic and German e-commerce growth look to be playing out.
• As revenues grow, multiple expansion to 5.4x could be in the cards, seeing Crocs potentially valued at $10.8 billion, ~50% upside to $165.
• However, the key question remains: when does this growth evaporate, when does the high double-digit growth end?
• A growth slowdown during 2022 can threaten the rally, as Crocs has faced issues meeting high targets and does not drive shareholder value through buybacks/dividends.

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