Deckers Outdoor Corporation (DECK) | Investment Case

1. Company Snapshot

1.a. Company Description

Deckers Outdoor Corporation, together with its subsidiaries, designs, markets, and distributes footwear, apparel, and accessories for casual lifestyle use and high-performance activities.The company offers premium footwear, apparel, and accessories under the UGG brand name; sandals, shoes, and boots under the Teva brand name; and relaxed casual shoes and sandals under the Sanuk brand name.It also provides footwear and apparel for ultra-runners and athletes under the Hoka brand name; and fashion casual footwear using other plush materials under the Koolaburra brand.

The company sells its products through department stores, domestic independent action sports and outdoor specialty footwear retailers, and larger national retail chains, as well as online retailers.It also sells its products directly to consumers through its retail stores and e-commerce websites, as well as distributes its products through distributors and retailers in the United States, Europe, the Asia-Pacific, Canada, Latin America, and internationally.As of March 31, 2022, it had 149 retail stores, including 75 concept stores and 74 outlet stores worldwide.

The company was founded in 1973 and is headquartered in Goleta, California.

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1.b. Last Insights on DECK

Deckers Outdoor Corporation's recent performance was driven by its impressive Q3 2026 results, which surpassed EPS and revenue expectations. The company's ability to grow profitably despite tariff headwinds and a promotional retail environment was rewarded by investors. Additionally, the company's upgraded FY26 outlook and strong earnings report, featuring $3.33 EPS and $1.96 billion in revenue, contributed to its positive momentum. Technical indicators also suggest a bullish trend, with the stock crossing above its 20-day, 50-day, and 200-day moving averages. Institutional investors, such as Harel Insurance Investments & Financial Services Ltd., have also increased their positions in the company.

1.c. Company Highlights

Last Price	115.73
Change Percentage	-0.25%
Open	116.02
Previous Close	116.02
Market Cap ( Millions)	16867
Volume	1898110
Year High	156.6
Year Low	78.91
M A 50	104.73
M A 200	104.48

FCF Yield	5.51%
Dividend Yield	0.00%
ROE	41.36%
Debt / Equity	13.14%
Net Debt / EBIDTA	-127.70%
Price To Book	6.52
Price Earnings Ratio	16.35
Price To FCF	18.15
Price To sales	3.14
EV / EBITDA	11.07

2. Deckers Brands' Strong Q3 FY 2026 Results Driven by HOKA and UGG Growth

Deckers Brands reported a robust third quarter fiscal 2026 performance, with revenue increasing 7% to $1.96 billion. The company's diluted earnings per share (EPS) reached a record $3.33, an 11% increase from the prior year, driven primarily by HOKA's 18% revenue growth to $629 million and UGG's 5% growth to a record $1.3 billion. Gross margin was 59.8%, better than expected, primarily due to a lower-than-expected impact from increased tariffs. As Stefano Caroti, CEO, noted, "I'm really proud of the success our entire team has delivered this year, and I'm even more excited for what lies ahead."

Publication Date: Feb -08

                                    📋 Highlights
                                    Revenue Growth::
                                                Q3 revenue rose 7% to $1.96 billion, driven by HOKA’s 18% growth ($629 million) and UGG’s 5% increase ($1.3 billion).
UGG Performance::
                                                Achieved record quarterly revenue of $1.3 billion, with DTC up 5% and wholesale up 4%, aided by new product lines like Quill.
Earnings Surge::
                                                Diluted EPS hit a record $3.33, a 11% increase, supported by disciplined cost management and a $1.8 billion share repurchase program.
Full-Year Guidance::
                                                Raised revenue forecast to $5.4–5.425 billion, with HOKA targeting mid-teens growth and UGG mid-single digits, gross margin at ~57%.
Channel Momentum::
                                                HOKA’s DTC revenue grew 19% and wholesale 18%, while UGG’s DTC and wholesale channels saw balanced growth, reflecting strong consumer demand.

                                

Brand Performance

Both HOKA and UGG delivered balanced growth across direct-to-consumer (DTC) and wholesale channels. HOKA's DTC revenue increased 19%, while wholesale revenue grew 18%. UGG's DTC revenue rose 5%, with wholesale revenue growing 4%. The success of UGG's new Quill franchise and HOKA's innovative products, particularly in the road running category, drove the brands' performance. HOKA's market share expanded in the U.S. road running category, and the brand's lifestyle strategy is being advanced through product development and expansion.

Guidance and Outlook

Deckers Brands raised its full-year revenue expectations to a range of $5.4 billion to $5.425 billion, with HOKA's revenue growth expected to be in the mid-teens and UGG's revenue growth expected to be in the mid-single digits. Gross margin is expected to be approximately 57%, and operating margin is expected to be approximately 22.5%. The company's guidance for FY '27 indicates continued growth for UGG, with visibility through the first three quarters of next year.

Valuation

With a P/E Ratio of 16.31 and an EV/EBITDA of 11.04, Deckers Brands' valuation appears reasonable, considering its strong growth prospects. The company's ROE of 41.36% and ROIC of 31.9% indicate high profitability. Analysts estimate next year's revenue growth at 6.9%, which is slightly higher than the current P/S Ratio of 3.13. The actual EPS of $3.33 exceeded estimates of $2.77, demonstrating the company's ability to deliver strong earnings.

Tariff Impact

The company expects the unmitigated tariff impact on fiscal year 2026 to be approximately $110 million, with a net tariff impact of approximately $25 million. Deckers Brands believes its brands have the resilience to continue delivering growth and profitability, even in the face of tariffs.

3. NewsRoom

UGG Redefines Men's Fashion in Latest Spring 2026 Campaign Fronted by Global Icons Central Cee & Su Yiming

Feb -13

Source: businesswire.com

2 Must-Buy Outdoor Industry Stocks Flying High Year to Date

Feb -11

Source: zacks.com

Penserra Capital Management LLC Buys Shares of 4,968 Deckers Outdoor Corporation $DECK

Feb -09

Source: defenseworld.net

BetterInvesting™ Magazine Update on ServiceNow Inc. (NYSE: NOW) and Deckers Outdoors Corp. (NYSE: DECK)

Feb -06

Source: prnewswire.com

Is Deckers Outdoor (DECK) Outperforming Other Retail-Wholesale Stocks This Year?

Feb -03

Source: zacks.com

Deckers Outdoor: The Reasons Why I Upgrade From Hold To Buy

Feb -03

Source: seekingalpha.com

GAP vs. DECK: Which Stock Is the Better Value Option?

Feb -02

Source: zacks.com

Deckers (DECK) Recently Broke Out Above the 20-Day Moving Average

Feb -02

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.95%)

6. Segments

Direct-to-Consumer

Expected Growth: 10%

Deckers Outdoor Corporation's Direct-to-Consumer segment growth is driven by strong e-commerce capabilities, effective digital marketing, and strategic brand investments. The company's focus on omnichannel retailing, product innovation, and customer experience enhancements also contribute to its 10% growth. Additionally, Deckers' ability to leverage its brands' strong heritage and authenticity resonates with consumers, further fueling growth.

UGG

Expected Growth: 11%

UGG's 11% growth driven by strong brand recognition, increasing demand for comfort footwear, successful marketing campaigns, and strategic expansion into new markets, particularly in Asia. Additionally, the brand's focus on sustainability and digital transformation has resonated with consumers, contributing to its growth momentum.

HOKA

Expected Growth: 13%

HOKA's 13% growth is driven by increasing popularity of trail running, strategic partnerships with running influencers, and expansion into new markets. Additionally, Deckers' focus on digital marketing, e-commerce growth, and premium product offerings have contributed to the brand's success. Furthermore, HOKA's innovative products, such as max cushioning and rocker technology, have resonated with consumers seeking high-performance running shoes.

Teva

Expected Growth: 9%

Teva's 9% growth is driven by increasing demand for outdoor activities, expanding distribution channels, and strategic partnerships. Additionally, the brand's focus on sustainability and innovative products, such as the Terra-Float and Ember collections, resonates with environmentally conscious consumers, contributing to its growth momentum.

Other Brands Wholesale

Expected Growth: 8%

Strong demand for outdoor gear, increasing popularity of hiking and outdoor activities, successful product innovation, and strategic partnerships with key retailers drive the 8% growth of Other Brands Wholesale from Deckers Outdoor Corporation. Additionally, effective inventory management and optimized supply chain operations contribute to the segment's growth.

Sanuk

Expected Growth: 7%

Sanuk's 7% growth is driven by increasing demand for comfortable and casual footwear, particularly among younger generations. Strong online presence, strategic partnerships, and effective marketing campaigns have contributed to the brand's expansion. Additionally, Deckers Outdoor Corporation's focus on product innovation, quality, and sustainability has enhanced Sanuk's appeal, attracting a wider customer base and driving sales growth.

7. Detailed Products

UGG

Luxury footwear, apparel, and accessories for men, women, and kids, known for their sheepskin boots and comfort-focused designs.

HOKA ONE ONE

Max cushioning and comfortable running shoes for runners and outdoor enthusiasts, offering superior comfort and performance.

Teva

Outdoor footwear and sandals for water sports, hiking, and casual wear, emphasizing comfort, durability, and versatility.

Sanuk

Comfortable and casual footwear, including sandals, shoes, and boots, for relaxed, everyday wear.

Ahnu

Outdoor footwear and apparel for hiking, trail running, and outdoor enthusiasts, focusing on comfort, support, and durability.

8. Deckers Outdoor Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Deckers Outdoor Corporation faces moderate threat from substitutes, as customers have limited alternatives for high-quality outdoor footwear and apparel. However, the company's focus on innovation and sustainability helps to differentiate its products and reduce the threat of substitutes.

Bargaining Power Of Customers

Deckers Outdoor Corporation has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's strong brand reputation and high-quality products reduce the likelihood of customers switching to competitors.

Bargaining Power Of Suppliers

Deckers Outdoor Corporation relies on a few large suppliers for raw materials, which gives them some bargaining power. However, the company's long-term relationships with suppliers and its ability to negotiate prices help to mitigate this risk.

Threat Of New Entrants

The outdoor footwear and apparel industry has high barriers to entry, including significant capital requirements and the need for specialized expertise. This makes it difficult for new entrants to compete with established players like Deckers Outdoor Corporation.

Intensity Of Rivalry

The outdoor footwear and apparel industry is highly competitive, with many established players competing for market share. Deckers Outdoor Corporation faces intense rivalry from companies like VF Corporation, Columbia Sportswear, and Wolverine World Wide.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	11.24%
Debt Cost	3.95%
Equity Weight	88.76%
Equity Cost	9.18%
WACC	8.59%
Leverage	12.66%

11. Quality Control: Deckers Outdoor Corporation passed 9 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Weyco

A-Score: 6.4/10

Value: 7.1

Growth: 5.9

Quality: 7.1

Yield: 10.0

Momentum: 3.0

Volatility: 5.0

1-Year Total Return ->

PulteGroup

A-Score: 5.8/10

Value: 6.0

Growth: 8.8

Quality: 7.7

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

1-Year Total Return ->

Booking

A-Score: 5.8/10

Value: 3.6

Growth: 8.7

Quality: 8.0

Yield: 1.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

Deckers

A-Score: 4.4/10

Value: 4.6

Growth: 9.1

Quality: 8.5

Yield: 0.0

Momentum: 0.5

Volatility: 3.7

1-Year Total Return ->

Nike

A-Score: 4.2/10

Value: 2.0

Growth: 3.9

Quality: 5.9

Yield: 4.0

Momentum: 3.5

Volatility: 5.7

1-Year Total Return ->

Steven Madden

A-Score: 4.0/10

Value: 2.7

Growth: 5.2

Quality: 4.4

Yield: 4.0

Momentum: 3.5

Volatility: 4.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

3.30%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.59%

Deckers Outdoor Corporation - US2435371073

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on DECK

1.c. Company Highlights

Expensive

Better Quality

Strong Momentum

Earnings Beats

Revenues Beats

Earnings Miss

Fairly Valued

Revenues Miss

Higher Growth

Weak Momentum

Stable Momentum

2. Deckers Brands' Strong Q3 FY 2026 Results Driven by HOKA and UGG Growth

Brand Performance

Guidance and Outlook

Valuation

Tariff Impact

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.95%)

6. Segments

Direct-to-Consumer

Expected Growth: 10%

UGG

Expected Growth: 11%

HOKA

Expected Growth: 13%

Teva

Expected Growth: 9%

Other Brands Wholesale

Expected Growth: 8%

Sanuk

Expected Growth: 7%

7. Detailed Products

UGG

HOKA ONE ONE

Teva

Sanuk

Ahnu

8. Deckers Outdoor Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Deckers Outdoor Corporation passed 9 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

115.73$

Current Price

115.73$

Potential

-0.00%

12.e Scoring ^Insights

12.f DCF ^BETA