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On Friday, Deckers Outdoor Corporation (NYSE: NYSE:DECK) stock is poised to open significantly lower, with pre-market trading indicating a 15% drop to approximately $107. This anticipated decline follows the company’s fourth-quarter earnings report, which has sparked debate among investors. According to InvestingPro data, the stock has already fallen over 47% in the past six months, though it trades at an attractive P/E ratio of 19.9x relative to its growth potential. Needham analysts, acknowledging the contentious outlook, have adjusted their price target for Deckers stock to $120, down from the previous $150, while still maintaining a Buy rating on the shares.
The downward revision comes in the wake of a notable slowdown in Deckers’ Hoka brand, particularly in its direct-to-consumer (DTC) sales channel. Despite the long-term bullish stance of the analysts, they recognize that it may take some time for the stock to regain its previous momentum. Consequently, financial estimates have been revised, leading to the new price target of $120. InvestingPro analysis reveals that 14 analysts have recently revised their earnings expectations downward, though the company maintains strong fundamentals with a perfect Piotroski Score of 9.
Deckers did, however, surpass its quarterly guidance, reporting constant-currency revenue growth of 8%, which exceeds the expected low single-digit (LSD) growth. Earnings per share (EPS) for the quarter were also notably higher than forecasted, coming in at $1.00 compared to the guided range of $0.42 to $0.47.
Looking ahead, Deckers has not provided guidance for the full fiscal year 2026, but they have projected an 8-10% increase in revenues for the first quarter and an EPS of $0.62 to $0.67. These figures fall short of Wall Street’s expectations, which anticipated a 12% revenue growth and an EPS of $0.79 for the same period.
In other recent news, Deckers Outdoor Corporation reported its fourth-quarter earnings for fiscal year 2025, showing a notable increase in UGG brand revenue, which exceeded Stifel’s estimates by $60 million. Despite this, the HOKA brand did not meet revenue expectations, falling short by $23 million, marking its first miss since December 2021. Stifel analysts maintained a Hold rating on Deckers, citing concerns over HOKA’s direct-to-consumer sales growth. Meanwhile, UBS raised the price target for Deckers to $169, maintaining a Buy rating based on anticipated earnings per share growth driven by HOKA’s sales acceleration.
Piper Sandler reiterated a Neutral rating with a $100 price target, noting a slowdown in Deckers’ direct-to-consumer channel, particularly in the U.S. However, the firm anticipates growth in international sales and wholesale channels. Citi analysts maintained a Buy rating with a $150 target, highlighting Deckers’ fourth-quarter EPS of $1.00, which surpassed consensus estimates, though HOKA’s growth was below expectations. KeyBanc downgraded Deckers to Sector Weight, citing concerns over HOKA’s decelerating growth and competitive pressures from other running brands.
Despite these mixed reviews, Deckers management remains optimistic about HOKA’s potential for low double-digit growth in the first quarter of fiscal year 2026. The company is also focusing on international expansion and new partnerships to drive future growth. With a $2.25 billion stock buyback program announced, Deckers is set to repurchase up to 15% of its market capitalization, potentially providing a boost to its stock value.
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