Wolverine World Wide stock rallies after earnings beat and as it explores alternatives for its Sperry brand

Shares of Wolverine World Wide Inc. (WWW) rallied 3.3% in premarket trading Wednesday, after the casual, active and uniform footwear and apparel, with brands including Saucony, Hush Puppies, Sperry and Stride Rite, reported first-quarter earnings that beat expectations and said it was "exploring strategic alternatives" for its Sperry brand. Net income rose to $19.0 million, or 23 cents a share, from $9.7 million, or 12 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of 9 cents beat the FactSet consensus of 4 cents. Revenue fell 25.0% to $599.4 million but was above the FactSet consensus of $577.5 million. "We need to focus our efforts and investments on our Active and Work Groups, specifically our growth brands -- Merrell, Saucony and Sweaty Betty. The recent sale of Keds and pending licensing of Hush Puppies will enable this focus, and these transitions are well underway," said Chief Executive Officer Brendan Hoffman. "We are now exploring strategic alternatives for Sperry while we continue the foundational work needed to position the brand for long-term success." For 2023, the company expects adjusted EPS of $1.40 to $1.60 and revenue of $2.53 to $2.58, with both surrounding the FactSet consensus for EPS of $1.45 and for revenue of $2.55 billion. The stock has soared 38.2% year to date through Tuesday, while the S&P 500 has gained 7.3%.

-Tomi Kilgore

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05-10-23 0645ET

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