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Headquartered in Goleta, California, Deckers Outdoor Corporation (DECK) is a leading designer, marketer, and distributor of innovative footwear, apparel, and accessories. With a market cap of $21.7 billion, Deckers is renowned for its portfolio of premium brands, including UGG, HOKA, and Teva, which cater to a diverse global audience.
Shares of this footwear apparel company have lagged behind the broader market over the past 52 weeks. DECK stock has gained marginally over this time frame, while the broader S&P 500 Index ($SPX) has rallied 17.5%. However, on a YTD basis, the stock is down 28.6%, compared to SPX’s 1.3% gains.
Zooming in further, the stock has also underperformed the Consumer Discretionary Select Sector SPDR Fund's (XLY) 18.5% return over the past 52 weeks.
On Jan. 30, DECK stock dropped 16.8% after mixed Q4 earnings results, as strong earnings were overshadowed by a slight revenue guidance miss and slowing growth expectations. The company reported a 17.1% year-over-year revenue increase to $1.83 billion. GAAP EPS reached $3, outperforming forecasts by 14.9%. While the company raised its full-year revenue guidance to $4.9 billion at the midpoint, it still came marginally below analyst estimates. Full-year GAAP EPS is projected at $5.78.
For the current fiscal year, ending in March 2025, analysts expect DECK’s EPS to increase 21.2% year over year to $5.89. Moreover, the company’s earnings surprise history is highly impressive. It surpassed the consensus estimates in each of the last four quarters.
Among the 20 analysts covering the stock, the consensus view is a “Moderate Buy,” which is based on 10 “Strong Buys,” two “Moderate Buys,” and eight “Hold” ratings.
The configuration is slightly more bullish than a month ago with nine analysts suggesting a “Strong Buy.”
On Jan. 31, Jesalyn Wong from Evercore ISI maintained a “Buy” rating on Deckers Outdoor, with a price target of $235, suggesting a 62.1% upside potential.
The mean price target of $223.76 represents a 54.3% upside from DECK’s current price levels, while the Street-high price target of $284 suggests an ambitious upside potential of 95.9%.
