Wolverine Worldwide (WWW)

Footwear conglomerate Wolverine Worldwide (NYSE:WWW) reported Q3 CY2025 results topping the market’s revenue expectations, with sales up 6.9% year on year to $470.3 million. The company expects the full year’s revenue to be around $1.86 billion, close to analysts’ estimates. Its non-GAAP profit of $0.36 per share was 9.2% above analysts’ consensus estimates.

Company Overview

Founded in 1883, Wolverine Worldwide (NYSE:WWW) is a global footwear company with a diverse portfolio of brands including Merrell, Hush Puppies, and Saucony.

Before the advent of the internet, styles changed, but consumers mainly bought shoes by visiting local brick-and-mortar shoe, department, and specialty stores. Today, not only do styles change more frequently as fads travel through social media and the internet but consumers are also shifting the way they buy their goods, favoring omnichannel and e-commerce experiences. Some footwear companies have made concerted efforts to adapt while those who are slower to move may fall behind.

Wolverine Worldwide's primary competitors include Nike (NYSE:NKE), Adidas (ETR:ADS), VF Corp (NYSE:VFC), who owns The North Face and Vans, Deckers Outdoor (NYSE:DECK), who owns UGG and Hoka, and Columbia Sportswear (NASDAQ:COLM).

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Unfortunately, Wolverine Worldwide struggled to consistently increase demand as its $1.85 billion of sales for the trailing 12 months was close to its revenue five years ago. This wasn’t a great result and is a sign of poor business quality.

Long-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. Wolverine Worldwide’s recent performance shows its demand remained suppressed as its revenue has declined by 7.8% annually over the last two years.

This quarter, Wolverine Worldwide reported year-on-year revenue growth of 6.9%, and its $470.3 million of revenue exceeded Wall Street’s estimates by 1.4%.

Looking ahead, sell-side analysts expect revenue to grow 6% over the next 12 months. Although this projection implies its newer products and services will spur better top-line performance, it is still below average for the sector.

Wolverine Worldwide’s operating margin has risen over the last 12 months, leading to break even profits over the last two years. However, its large expense base and inefficient cost structure mean it still sports inadequate profitability for a consumer discretionary business.

In Q3, Wolverine Worldwide generated an operating margin profit margin of 8.4%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Wolverine Worldwide’s EPS was flat over the last five years, just like its revenue. This performance was underwhelming across the board.

In Q3, Wolverine Worldwide reported adjusted EPS of $0.36, up from $0.29 in the same quarter last year. This print beat analysts’ estimates by 9.2%. Over the next 12 months, Wall Street expects Wolverine Worldwide’s full-year EPS of $1.31 to grow 15.1%.

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Wolverine Worldwide has shown weak cash profitability over the last two years, giving the company limited opportunities to return capital to shareholders. Its free cash flow margin averaged 7.2%, subpar for a consumer discretionary business.

Wolverine Worldwide’s free cash flow clocked in at $30.1 million in Q3, equivalent to a 6.4% margin. The company’s cash profitability regressed as it was 17.3 percentage points lower than in the same quarter last year, prompting us to pay closer attention. Short-term fluctuations typically aren’t a big deal because investment needs can be seasonal, but we’ll be watching to see if the trend extrapolates into future quarters.

Over the next year, analysts predict Wolverine Worldwide’s cash conversion will improve. Their consensus estimates imply its free cash flow margin of 2.9% for the last 12 months will increase to 7.6%, giving it more flexibility for investments, share buybacks, and dividends.

EPS and free cash flow tell us whether a company was profitable while growing its revenue. But was it capital-efficient? Enter ROIC, a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity).

Wolverine Worldwide’s five-year average ROIC was negative 2.7%, meaning management lost money while trying to expand the business. Its returns were among the worst in the consumer discretionary sector.

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Unfortunately, Wolverine Worldwide’s ROIC averaged 2.7 percentage point decreases over the last few years. Paired with its already low returns, these declines suggest its profitable growth opportunities are few and far between.

Wolverine Worldwide reported $133.9 million of cash and $822.1 million of debt on its balance sheet in the most recent quarter. As investors in high-quality companies, we primarily focus on two things: 1) that a company’s debt level isn’t too high and 2) that its interest payments are not excessively burdening the business.

With $185.6 million of EBITDA over the last 12 months, we view Wolverine Worldwide’s 3.7× net-debt-to-EBITDA ratio as safe. We also see its $17.6 million of annual interest expenses as appropriate. The company’s profits give it plenty of breathing room, allowing it to continue investing in growth initiatives.

It was good to see Wolverine Worldwide beat analysts’ EPS expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. On the other hand, its full-year revenue guidance was in line and its full-year EPS guidance fell slightly short of Wall Street’s estimates. Zooming out, we think this was a mixed quarter. The market seemed to be hoping for more, and the stock traded down 8.6% to $20.20 immediately following the results.

Updated: December 4, 2025 at 10:01 PM EST

The latest quarterly earnings matters, sure, but we actually think longer-term fundamentals and valuation matter more. Investors should consider all these pieces before deciding whether or not to invest in Wolverine Worldwide.

Wolverine Worldwide falls short of our quality standards. To kick things off, its revenue growth was weak over the last five years. On top of that, Wolverine Worldwide’s weak EPS growth over the last five years shows it’s failed to produce meaningful profits for shareholders, and its projected EPS for the next year is lacking.

Wolverine Worldwide’s P/E ratio based on the next 12 months is 13.3x. While this valuation is reasonable, we don’t see a big opportunity at the moment. There are better stocks to buy right now.

Wall Street analysts have a consensus one-year price target of $24.33 on the company (compared to the current share price of $17.29).

Although the price target is bullish, readers should exercise caution because analysts tend to be overly optimistic. The firms they work for, often big banks, have relationships with companies that extend into fundraising, M&A advisory, and other rewarding business lines. As a result, they typically hesitate to say bad things for fear they will lose out. We at StockStory do not suffer from such conflicts of interest, so we’ll always tell it like it is.