Crocs is momentarily stable at $70 but downward pressure will continue to $57

Crocs Inc. (NASDAQ:CROX) has been under downward pressure since November 2021. Since February, the price has stabilized between $70 and $80. The stock, therefore, seems to establish a new support level at the price. However, investors may not be confident enough to accept higher prices on the security.

Crocs is rated a hold by Zacks Research. Fundamental analysis shows an excellent A-score on value and growth expectations, while momentum scores a B. The price/earnings to growth ratio is at 0.50. When the PEG ratio is below 1, the stock is considered a buy because it is undervalued.

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A closer look at Crocs points to a recent acquisition of the Hey Dude brand as the greatest recent news for the brand. That acquisition will result in earnings growth, but investors cannot be too optimistic. Growth may not be more than 15%. The fact that Crocs serves the discretionary market is a reason to take caution when dealing with security.

Crocs’ price correction continues

Analysis of the price chart shows that for the longest time the share was valued at between $25 and $40 before it rose in the bullish wave of the pandemic period. The bulls pushed the stock to the highs of $175. Since November, the price has dropped to $75, signaling a market correction.

The stock appears to have found some support at $70 but how strongly that can hold is in doubt. The 200-days moving average is at $56.98, and this analysis considers that this could be the key support for the stock. The RSI is resisting upward momentum despite being close to the oversold indicator. Considering these indicators, investors should wait longer to buy Crocs.

Summary

Crocs has momentary support at $70, but the downward pressure may continue to $57. The company faces slow growth. The share price is correcting despite an attractive PEG ratio.

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