We're into the sailing season now, so let's look at the major players in the boat-shoe business. While flip-flops seem to be the footwear of choice for so many in the summer, for those preferring the solid comfort of a well-built boat shoe, the choice is likely the Sperry Top-Sider, the best-known and oldest brand of boat shoe available. Paul Sperry invented the Top-Sider in 1935 and they've been selling them ever since. Today, owned by Collective Brands (NYSE:PSS), we'll look at the seven companies that compete for boat shoe supremacy.

IN PICTURES: 8 Great Companies With Top-Notch Healthcare Benefits

Boat Shoe Competitors

Brand Company Market Cap
Sperry Top-Sider Collective Brands (NYSE:PSS) $1.25B
Cole Haan Nike (NYSE:NKE) $35.5B
Ecco Privately Held N/A
Geox Geox 1.0B Euros
Rockport Adidas (OTC:ADDYY) $10.0B
Sebago Wolverine World Wide (NYSE:WWW) $1.4B
Timberland Timberland (NYSE:TBL) $1.0B

King of the Sea
Footwear News made Top-Sider its 2009 Brand of the Year. Not wanting to lose momentum as it celebrates its 75th anniversary in 2010, the company has opened three stores in Florida, one in Texas and more to come across the country. Collective Brands first-quarter report was mostly positive, aided by strong sales in its performance and lifestyle wholesale group, which includes Sperry Top-Sider. The wholesale group's sales increased 16.5% to $173.4 million and its operating income jumped 62.9% to $23.3 million. Although the wholesale group generated just 20% of the overall revenue in the quarter, it generated 29% of Collective's total operating income.

In addition to Sperry Top-Sider, the wholesale division saw increased sales from its Saucony and Keds brands. It's too early to tell how the new retail stores will do but if it continues to win awards from the trade and deliver strong revenue growth, you can be sure Collective will pour greater resources into the iconic brand.

The Rest
Clearly, Sperry Top-Sider is the brand to beat when it comes to boat shoes. Although every brand of shoe seems to have a boat shoe of some description today, none can match the history of Sperry. Ironically, Collective Brands CEO Matthew Rubel ran Cole Haan from 1999 until 2005 when he took the top job at Payless Shoes, which then bought Stride Rite in 2007, creating the existing company.

Cole Haan sells its version of boat shoe with Nike Air technology for $148, more than twice what Sperry charges for its original. Cole Haan is part of Nike's "Other Businesses" segment, which includes Nike Golf, Converse, Hurley and Umbro.

In the third quarter, Cole Haan's revenues were flat year-over-year. On an annual basis, they've remained around $470 million for the last three years. In May, Nike suggested its other businesses would add an additional $1.5-$2.0 billion in revenue by 2015. Most of it will come from Converse and Umbro. Clearly, Cole Haan is not its real competition.

Price Points
Sperry Top-Sider's true competition is from Rockport, Sebago and Timberland whose boat shoes sell at Zappos.com between $75 and $100. Geox and ECCO are similarly priced to Cole Haan's boat shoe.

In terms of revenues, Timberland is the biggest of the four companies (including Sperry Top-Sider) with footwear revenues in 2009 of $931 million. How much of this is from boat shoes isn't readily available but I'll estimate that boat shoes represent 25% of footwear revenues for all four companies. That being the case, Timberland's boat shoe revenues in 2009 were $233 million, $83 million for Rockport, $50 million for Sebago and $128 million for Sperry Top-Sider.

Of my four estimates, the one I have the biggest problem with is Timberland. I just don't see them doing more boat shoe business than Sperry does. For that reason, I'll guess that Timberland and Sperry are neck-and-neck in boat-shoe business.

The Bottom Line
When you're a brand that's been around for 75 years, you've seen plenty of good times and bad. This year looks to be a good one for Sperry and the rest of Collective Brands businesses. While sales won't grow much, it has some of the highest operating margins in the business. When all's said and done, boat shoes never go out of style. (To learn more, check out Analyzing Retail Stocks.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Stock Analysis

    Analyzing Altria's Return on Equity (ROE) (MO)

    Learn about Altria Group's return on equity (ROE) and analyze net profit margin, asset turnover and financial leverage to determine what is causing its high ROE.
  2. Investing News

    Icahn's Bet on Cheniere Energy: Should You Follow?

    Investing legend Carl Icahn continues to lose money on Cheniere Energy, but he's increasing his stake. Should you follow his lead?
  3. Stock Analysis

    Analyzing Google's Return on Equity (ROE) (GOOGL)

    Learn about Alphabet's return on equity. How has its ROE changed over time, how does it compare to its peers and what factors are driving ROE for the company?
  4. Investing News

    Is Buffett's Bet on Oil Right for You? (XOM, PSX)

    Oil stocks are getting trounced, but Warren Buffett still likes one of them. Should you follow the leader?
  5. Investing News

    Chipotle Served with Criminal Probe

    Chipotle's beat muted expectations and got a clear bill from the CDC, but it now appears that an investigation into its E.coli breakout has expanded.
  6. Stock Analysis

    Analyzing Sprint Corp's Return on Equity (ROE) (S)

    Learn about Sprint's return on equity. Find out why its ROE is negative and how asset turnover and financial leverage impact ROE relative to Sprint's peers.
  7. Stock Analysis

    Why Alphabet is the Best of the 'FANGs' for 2016

    Alphabet just impressed the street, but is it the best FANG stock?
  8. Investing News

    A 2016 Outlook: What January 2009 Can Teach Us

    January 2009 and January 2016 were similar from an investment standpoint, but from a forward-looking perspective, they were very different.
  9. Mutual Funds & ETFs

    3 Vanguard Equity Fund Underperformers

    Discover three funds from Vanguard Group that consistently underperform their indexes. Learn how consistent most Vanguard low-fee funds are at matching their indexes.
  10. Investing News

    Alphabet Earnings Beat Expectations (GOOGL, AAPL)

    Alphabet's earnings crush analysts' expectations; now bigger than Apple?
RELATED FAQS
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center