K-Swiss hits 7-year low as analyst cuts estimates

NEW YORK (AP) — Shares of K-Swiss Inc. declined for the ninth trading day in a row Monday, sliding to their lowest point in more than seven years as an analyst cut his estimates for 2009.

The iconic sneaker maker posted a worse fourth-quarter loss than analysts expected, issued a weak outlook for the rest of the year and suspended its dividend last week.

On Monday, Sterne Agee analyst Sam Poser said the company's gross margins were "abysmal" because of the company's heavy discounting and "lack of innovative new product."

While the company has been successful in difficult economic times before, Poser said the company's marketing and distribution strategies will this time leave it "out of sight and out of mind" of consumers if not altered before spring 2010.

Poser lowered his 2009 revenue estimate to $235 million from $292 million and reduced his per-share estimate for the year to loss of 56 cents from a loss of 13 cents.

The company's strong balance sheet should keep it going for a number of years, Poser said, but without new marketing, fashion and distribution strategies, the company "will face a worsening situation."

He maintained a "Neutral" rating.

Shares of K-Swiss dropped 40 cents, or 5.7 percent, to $6.59 in afternoon trading. They earlier drifted as low as $6.47, their lowest point since October 2001.