Crocs ( CROX) Company Profile: Crocs designs and markets consumer products, mainly casual & athletic shoes & shoe charms, from specialty resins referred to as Croslite. Current Share Price: $17.19 (Jan. 6) 2010 Share Price Gain: 186% Comeback Story: Crocs was poised to be the ultimate fashion fad of the 2000s, with the contempt for the footwear rivaling the evangelical following Crocs shoes garnered. After going public in 2006 for roughly $17, Crocs shares jumped to nearly $70 in October 2007 during the fever pitch of the shoes' popularity. However, the retail environment wasn't friendly enough to Crocs, forcing the company to slash revenue guidance. After issuing lower-than-expected revenue and profit expectations in October 2007, Crocs shares dropped 30% in one trading session. By early 2009, Crocs was a penny stock. However, shares have rallied back to a 52-week high of $19.54 thanks to analyst optimism. For example, Sterne Agee analysts in October said they anticipate Crocs' wholesale revenue will grow at a double-digit percentage pace for at least the next two years. "It's starting to make sense to go back into Crocs. They seem to have turned the corner from before," Wilsey says. "The debt to equity is only 0.9. The company has no debt and a lot in cash and short-term investments. It was an educated risk because the company isn't going into bankruptcy." Michael Corbett, manager of the Perritt Emerging Opportunities Fund, notes that Crocs had similar characteristics to Heelys. "It was so far below book value that you had to think 'Are they actually going to burn through all the cash and go bankrupt?' It's the opposite of greed. There was fear it was going under. Is the fad going to come back? Probably not. But it's not going to zero." Hodges says Crocs was doing $240 million in sales per quarter, totaling almost a $1 billion sales business, but the backlash against the product proved to be too great for a time. "There was a backlash to the popularity and Crocs became a punch line," Hodges says. "I think I saw a skit on Saturday Night Live about Crocs. It went from one side to the other over the period of a year. But we realized that while they may not sell $1 billion of shoes every year, the underlying business has international opportunities and a bunch of new products."