Stifel maintains Hold on Deckers stock, price target at $127

On Monday, Stifel analysts maintained their Hold rating on Deckers Outdoor Corporation (NYSE: NYSE:DECK) shares with a price target of $127.00. The firm’s analysis highlighted Deckers’ fourth quarter fiscal year 2025 performance, which surpassed expectations in several areas. UGG brand revenues exceeded Stifel’s estimates by $60 million, and the company’s gross margin reached an impressive 57.9%. Deckers also demonstrated effective expense control and benefited from a favorable tax rate. According to InvestingPro data, the company maintains strong financial health with a perfect Piotroski Score of 9 and holds more cash than debt on its balance sheet.

Despite these positive results, concerns were raised regarding the HOKA brand, which fell short of consensus revenue estimates by $23 million. This marks the first miss since December 2021 when COVID-19 related supply disruptions impacted sales. The market has reacted strongly to these concerns, with the stock declining 21% in the past week and 47.4% over the last six months, according to InvestingPro data. Although HOKA has been identified as having a credible growth strategy through brand awareness, international expansion, and diversified product applications, its direct-to-consumer (DTC) sales deceleration is noteworthy. After a strong growth from the first to third quarter of fiscal year 2025, HOKA’s year-over-year growth slowed to 3%, including declines in the U.S. market.

Stifel’s outlook for fiscal year 2026 anticipates flat earnings for Deckers, as the company absorbs tariffs and leverages investments. The shift in HOKA’s growth composition towards an expansion of wholesale doors and a greater contribution from UGG is seen as less favorable compared to the recent DTC-driven HOKA model. The firm expressed caution, suggesting that clearer signs of HOKA’s brand extensibility are needed before adopting a more positive stance.

The reaffirmed $127 price target is based on a valuation of 12.6 times enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) and 18.7 times price to earnings (P/E) on fiscal year 2027 estimated earnings. Current InvestingPro analysis suggests the stock is trading below its Fair Value, with analyst targets ranging from $100 to $230.49. Stifel’s position reflects a watchful approach as they await further indicators of sustained brand momentum and growth potential within Deckers’ portfolio. For deeper insights into DECK’s valuation and 12 additional ProTips, visit InvestingPro, where you’ll find comprehensive analysis and the detailed Pro Research Report.

In other recent news, Deckers Outdoor reported mixed results for its fourth-quarter performance, exceeding expectations on both revenue and earnings. However, the company did not provide guidance for fiscal year 2026, leading to a series of price target adjustments by analysts. Truist Securities reduced its price target to $130 while maintaining a Buy rating, citing concerns over HOKA’s sales and a lack of forward visibility. Williams Trading also lowered its target to $129, noting weaker-than-expected HOKA sales but highlighting strong sell-through rates with retail partners. Meanwhile, TD Cowen cut its target to $157, maintaining a Buy rating and emphasizing potential near-term improvements in fiscal year 2026. BofA Securities adjusted its target to $128, maintaining a Neutral rating, with reservations about HOKA’s growth potential. Lastly, Needham set a new target of $120, also retaining a Buy rating, acknowledging the slowdown in HOKA’s direct-to-consumer sales. Despite the cautious outlook, Deckers announced a $2.25 billion share repurchase program, reflecting confidence in its stock value.

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