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On Friday, Piper Sandler reiterated a Neutral rating and a $100.00 price target on Deckers Outdoor (NYSE:DECK), following the company’s fiscal fourth quarter 2025 performance. The stock, currently trading at $101.05, has experienced significant pressure, declining 21% in the past week and 47% over the last six months. According to InvestingPro analysis, the company appears undervalued based on its Fair Value model. Deckers reported a modest sales beat of 1%, which is the smallest upside since the fiscal first quarter of 2024. The sales figures revealed a notable slowdown in the direct-to-consumer (DTC) channel, particularly in the United States, and a lower-than-expected growth of 10% in the HOKA brand, missing the anticipated 14% increase.
The DTC segment, which is often regarded as a true representation of consumer demand, experienced a significant deceleration, declining slightly in the US. Despite the pressure expected to continue in the DTC channel for the fiscal first quarter of 2026, a pickup in growth is anticipated later in the year. InvestingPro data shows the company maintains strong fundamentals with a perfect Piotroski Score of 9 and holds more cash than debt on its balance sheet, suggesting financial resilience during this transitional period. This is largely attributed to a transition in franchise operations that is nearing completion.
The growth narrative for Deckers is now shifting towards Wholesale and International channels. The company is entering new partnerships, such as with Journeys, and is focusing on expanding its international presence, which tends to be less transparent. Prior to the impact of tariffs, HOKA’s growth was projected in the mid-teens. However, Piper Sandler’s forecast for fiscal year 2026 assumes an approximate 30% increase in international sales, with a low single-digit percentage rise in the US market.
Piper Sandler has raised its fiscal year 2026 earnings per share estimate for Deckers to $5.80 from $5.65, owing to the company’s fiscal fourth quarter 2025 beat. The firm anticipates that Deckers’ stock will remain range-bound for the time being, with the direction of DTC sales and the US market being crucial to the company’s valuation multiple. Moreover, with a new $2.25 billion stock buyback program, part of a total $2.5 billion authorization, Deckers could potentially repurchase up to 15% of its market capitalization. The company’s strong financial position is reflected in its impressive 57.9% gross margin and 28.8% return on assets. Discover more insights and 12 additional ProTips about DECK with a subscription to InvestingPro, including exclusive access to comprehensive Pro Research Reports covering 1,400+ top stocks.
In other recent news, Deckers Outdoor Corporation reported its financial results for the fourth quarter of 2025, with earnings per share (EPS) of $1, exceeding the forecasted $0.59. Despite this earnings beat, the company’s stock saw a decline, with aftermarket trading closing at $107.80. The revenue for the quarter was reported at $1.02 billion, slightly above the expected $1.01 billion. For the full fiscal year 2025, Deckers achieved a 16% year-over-year revenue growth, reaching $4.986 billion, with significant contributions from its UGG and HOKA brands.
Analyst reactions to Deckers’ performance varied. Citi maintained a Buy rating with a $150 target, expressing optimism about HOKA’s potential growth after the first quarter. Conversely, KeyBanc downgraded the stock to Sector Weight, citing concerns over HOKA’s sales trajectory and competitive pressures. Similarly, Evercore ISI downgraded Deckers from Outperform to In Line, reducing the price target to $110, due to growth concerns and external pressures like tariffs.
Deckers’ management highlighted challenges in transitioning key HOKA models, affecting direct-to-consumer sales in the U.S. Despite these challenges, the company remains focused on expanding its international presence and maintaining strong wholesale performance. Analysts noted that while HOKA’s U.S. direct-to-consumer sales faced pressure, international growth remained robust, driven by increased brand awareness and strategic wholesale expansion.
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