Is Skechers U.S.A., Inc. overvalued or undervalued?

As of 8 August 2025, the valuation grade for Skechers U.S.A., Inc. has moved from fair to very attractive, indicating a significant improvement in its valuation outlook. The company appears undervalued, supported by a P/E ratio of 13, an EV to EBITDA ratio of 8.33, and a Price to Book Value of 2.06, which are favorable compared to its peers. For instance, On Holding AG has a much higher P/E of 101.93, while Kontoor Brands, Inc. shows a P/E of 17.91, further emphasizing Skechers' relative attractiveness.
In terms of peer comparison, Skechers' EV to EBITDA of 8.33 is lower than that of Ralph Lauren Corp. at 31.97, suggesting that Skechers is trading at a discount relative to its more expensive competitors. Additionally, the company's ROCE of 20.22% and ROE of 15.83% indicate strong profitability metrics. Despite recent underperformance against the S&P 500, with a year-to-date return of -6.11% compared to the index's 12.22%, the long-term perspective shows a solid 5-year return of 103.71%, which is higher than the S&P's 96.61%. This reinforces the notion that Skechers is a compelling investment opportunity at its current valuation.