At a very emotional 2014 Boston Marathon, Skechers USA (SKX) endorsee Meb Keflezighi won the race, the first win by an American man since 1983. And for Skechers, this win may be the most important in its history.
Skechers shares were trading just above $36 early Tuesday, up 8.8% year to date.
Meb Keflezighi blazed through the 2014 Boston Marathon with a time of 2 hours 8 minutes and 37 seconds, winning by a narrow 11 seconds. Keflezighi wore and debuted Skechers new GOmeb Speed 3 shoes, which will be available in stores in the fall of 2014. GOmeb, the shoe name, is a cheer for Meb himself, and the shoe is built to his specifications.
Skechers signed Keflezighi in 2011 as an official endorsee. Since that time, the company has renewed a deal that pays Meb a reported six figures.
For Keflezighi, the race was a tribute to his country. "A year ago I decided I wanted to win the 2014 Boston Marathon for the people of Boston and for the U.S.," he said. He also gave a shout-out to Skechers during his post-race interview, saying the win was helped by "the support of the Skechers Performance Division by my side."
The win boosts Keflezighi's career, which was already remarkable. In 2012, he won the U.S. Olympic Trials for the marathon and represented the U.S. in London. He has also won the Houston Marathon and several other prominent races in the U.S. Keflezighi broke a 27-year drought for U.S. males when he won the New York City Marathon in 2009. And at the 2004 Summer Olympics, Keflezighi won a silver medal.
The shoe worn by Keflezighi will be available in stores and online later this year and should see strong demand. Until then, consumers can purchase similar shoes, like the GOmeb Speed 2 for $115. The strong demand for the performance line of shoes will boost already strong same-store sales for Skechers. In the last fiscal quarter, same-store sales increased 12.8%.
To boost its prominence in the running category, Skechers will be one of the key sponsors for the Houston Marathon. For the Jan. 18, 2015, event, Skechers is designing and selling products with the official marathon logo. Skechers will also outfit the course volunteers with shoes and provide shirts for all finishers. This presence at a key race, which Meb has won in the past, will further boost Skechers' name recognition in the running category.
According to Running USA, 541,000 Americans took part in a marathon in 2013. These runners represent dollar signs to the shoe companies. Nike continues to dominate the running category, but has seen competition creep in. Skechers has a good chance to make a dent here.
Outside the marathon world, Skechers has several prominent endorsement deals with celebrities and former athletes. Skechers recently signed Danielle Bradbery, The Voice Season 4 winner, to be the new face of the brand. Her commercials will begin in spring of 2014 and last through 2015. The company sees the singer as a good follow-up to Carrie Underwood, another former Skechers endorsee. Skechers also renewed deals with Joe Montana and Mark Cuban, who will appear in ads over the next one to two years.
In fiscal 2013, Skechers saw revenue soar 18.3% to $1.85 billion. The company plans on opening 60 to 70 additional corporate-owned retail stores to help boost its sales growth and new product categories. Analysts see the company posting sales of $2.1 billion in fiscal 2014, an increase of 13.5%. In fiscal 2015, analysts think the company could also post double-digit growth, with expected sales of $2.3 billion. Skechers has a market capitalization of $1.8 billion.
Shares of Skechers increased 82% in 2013 and are up 14% already in 2014, as the company continues to innovate and expand into additional categories.
Skechers shares are now trading near their 52-week high of $37.83, after Monday's 2% increase and Tuesday's strong opening. More publicity from the race and analyst coverage could see shares hit new highs.
Investors should consider the large growth available for Skechers in a highly competitive market.
At the time of publication, the author held no positions in any of the stocks mentioned.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.