Crikey, Get a Load of Those Crocs!

Crocs, those bright, porous clogs, inspire strong reactions. Matt Cooper loves them, while Felix Salmon calls them "atrocious."

Shares of Crocs -- and their supporters and skeptics -- also swing to extremes. Is it a freaky fad or a new, powerful footwear brand? Last year, the stock soared 72 percent. Today, the Crocs critics are crowing as the stock is again in a free fall.

Shares of Crocs are down nearly 40 percent in morning trading after the company late on Monday lowered its sales and earnings forecasts for the first quarter and the year. The company is also closing its Canadian factory.

"The retail environment in the U.S. has become increasingly challenging as consumer spending and traffic levels have slowed," said Ron Snyder, the chief executive of Crocs. "Despite general weakness across the industry we continue to witness solid sell-through of our Crocs branded footwear and still expect domestic sales to still grow roughly 13 percent during the quarter. However, retailers in general are planning more cautiously, and therefore, we did not experience the level of at once business we originally expected."

The announcement on Monday is the latest in a series of disappointments for investors. In the last six months, shares of Crocs have fallen 12 percent or more on more than a handful of occasions.

The stock made its debut on the Nasdaq market at $21 in February 2006. It nearly tripled that year. This morning, it is trading at $10.62, down 85 percent from October.

Today's fall may have finally shaken the faith of the true believers in the stock.

"If things deteriorated this quickly in less than two months -- when Crocs was hopeful of earning $2.70 a share in 2008 -- how can we take it on its word over the next three quarters?," says Rick Aristotle Munarriz on the Motley Fool. "We can't. Those rose-colored specs have shattered. As a Crocs shareholder, I hate to admit that, but it's true."

Jeffrey Cane