Core Insights - The Nasdaq index has surged nearly 50% since April, indicating potential overvaluation from a technical perspective, with a notable 6% increase since September [1] - Investors are encouraged to take advantage of the current market conditions to purchase high-quality large-cap stocks that are trading below their historical highs [2] Company Overview: Deckers Brands - Deckers Brands (DECK) is recognized for its strong management, solid balance sheet, and promising growth outlook, having outperformed the S&P 500 over the last decade [3][4] - The stock has increased approximately 1,100% over the past ten years, significantly outperforming the S&P 500's 260% and Nike's 25% [4] - The growth of Deckers is largely attributed to its high-end running shoe brand HOKA, which has achieved a compound annual growth rate of around 50% over the last four years [7] Financial Performance - Deckers has experienced an average revenue growth of 19% from FY21 to FY25 and a 32% increase in GAAP earnings per share (EPS) [8] - Following a Q3 FY25 earnings release that provided weaker guidance, DECK stock fell approximately 48% from its all-time highs [11] - The stock is currently trading at a 30% discount to the Retail-Wholesale sector and 22% below the S&P 500, despite outperforming both by about four times over the past decade [16] Technical Analysis - Deckers stock found support at its long-term 200-week moving average, which has historically indicated potential for upward movement [12] - The stock is trading in line with its 10-year median at 18.1X forward 12-month earnings, suggesting it may be undervalued [16] Future Outlook - Revenue for Deckers is projected to grow by 9% in FY26 and 7% in FY27, with adjusted earnings expected to remain flat year-over-year in FY26 before increasing by 8% in FY27 [15] - The company maintains a robust balance sheet with $1.7 billion in cash and equivalents, $3.8 billion in total assets, and no debt, positioning it well to navigate economic uncertainties [17]

Core Viewpoint - Deckers Outdoor's brands Uggs and Hoka are experiencing a loss of sales momentum, which is expected to pressure the company's profit margins. Bernstein has rated Deckers as "underperform" with a target price of $100 [1] Group 1: Hoka Brand Analysis - Hoka has reached saturation in the U.S. running shoe market and is exiting a prolonged popularity cycle. Future growth rates are expected to slow to high single digits, primarily driven by international markets [1] - Hoka's cushioning technology has been imitated by competitors, and retailers are showing fatigue towards this trend. Nike's strong return in the running shoe sector poses a threat due to its more extensive product line, while On Running continues to expand its market share [2] Group 2: Uggs Brand Analysis - Uggs has seen significant growth in the global casual shoe market, but this category is gradually shrinking as consumers shift towards athletic shoes. The growth rate for Uggs is projected to be around 4%, a decline from the double-digit growth rates seen in previous years [2] Group 3: Financial Performance - Deckers' stock has declined by 43% year-to-date, closing at $115.43, down 2.74% as of the last trading day [3] - Despite both brands currently being profitable with gross margins close to 60%, the anticipated slowdown in growth and shifts in revenue structure towards wholesale and lower-priced categories are expected to gradually decrease profit margins. A forecasted decline of 190 basis points in gross margin is expected from fiscal year 2026 to 2030 [1]

Core Viewpoint - Deckers Outdoor Corp (NYSE:DECK) is facing challenges with its two main products, Uggs and Hoka, as sales appear to be declining, which may lead to margin pressure for the company [2] Product Performance - Sales of Uggs and Hoka are reportedly losing momentum, indicating potential difficulties in sustaining growth for these key products [2] Financial Outlook - The current situation has prompted Bernstein to assign an Underperform rating to the company, with a target price set at $100 [2]

Core Thesis - Deckers Outdoor Corporation is positioned as a strong player in the footwear industry, driven by the success of its brands UGG and Hoka, with a bullish outlook on its growth potential [1][2]. Financial Performance - As of September 3rd, Deckers' share price was $123.67, with trailing and forward P/E ratios of 18.88 and 19.88 respectively [1]. - Hoka experienced a sales growth of 29.3% in the first three quarters of 2025, contributing nearly 42% to total revenue [2]. - UGG, the largest brand, accounted for just over 54% of revenue and grew by 14.9% during the same period [3]. - The company's gross profit margin improved from 50.3% in 2023 to 60.3% by Q3 2025, reflecting a 1000 basis point increase [3]. - Deckers has no long-term debt and boasts a return on invested capital of 32.7%, with net income margins at 25% [4]. Strategic Initiatives - The shift towards direct-to-consumer (DTC) sales has been significant, with DTC now representing over 55% of net sales, up from 43% through wholesale channels [3]. - This DTC model has enhanced digital customer acquisition and expanded profit margins [3]. Valuation and Market Position - A discounted cash flow analysis indicates an intrinsic value of $124 per share, suggesting that the market may be undervaluing the company's growth potential [5]. - Despite strong fundamentals, Deckers' stock has declined nearly 45% year-to-date, indicating a disconnect between its financial performance and market valuation [4]. Market Sentiment - Previous analyses have highlighted Deckers' strong fundamentals and brand equity, with a recent appreciation of approximately 2% in stock price since earlier coverage [6].

Core Insights - Deckers Outdoor Corporation (DECK) is a significant player in the footwear and accessories industry, with a market cap of $17.6 billion, offering products under well-known brands like UGG, HOKA, and Teva [1][2] Financial Performance - DECK reported Q1 results with an EPS of $0.93, surpassing Wall Street expectations of $0.68, and revenue of $964.5 million, exceeding forecasts of $899 million [6] - For Q2, DECK anticipates revenue between $1.38 billion and $1.42 billion [6] Stock Performance - DECK's stock has experienced a 47% decline from its 52-week high of $223.98, reached on January 30 [3] - Over the past three months, DECK stock gained 16.9%, outperforming the Consumer Discretionary Select Sector SPDR Fund (XLY), which gained 13.7% [3] - Year-to-date, DECK shares have dipped 41.6% and fallen 23.9% over the past 52 weeks, underperforming XLY's YTD gains of 7.3% and 25.1% [4] Market Position and Challenges - DECK is categorized as a large-cap stock, indicating its size and influence in the industry [2] - The company faces challenges, including anticipated tariff costs of $185 million due to potential duty hikes in Vietnam, a 110-basis-point decline in gross margin, and weaknesses in HOKA's U.S. direct-to-consumer business [5] - Elevated inventory levels and rising selling, general and administrative (SG&A) expenses are additional strains on the company [5] Competitive Landscape - In the competitive footwear and accessories market, Crocs, Inc. (CROX) has shown resilience with a 29.2% decline year-to-date, but has outperformed DECK with 39.8% losses over the past 52 weeks [7]

Core Viewpoint - Deckers Outdoor (DECK) is identified as a potential investment opportunity due to its current trading discount and strong growth prospects despite recent stock price declines [2][3]. Financial Performance - Deckers' stock has fallen 46% from its peak earlier this year, primarily due to concerns over tariffs and slowing growth, which are now considered overblown following better-than-expected first-quarter earnings [3][12]. - The stock trades at a price-to-earnings ratio of 19, significantly lower than the S&P 500's P/E of 27, indicating an attractive valuation [5]. - Revenue for Deckers rose 16.9% to $964.5 million, surpassing estimates of $900.4 million [5]. - Hoka sales increased by 19.8% to $653.1 million, while Ugg sales rose by 18.9% to $265.1 million [6]. Market Dynamics - Domestic sales decreased by 2.8% to $501.3 million, but international sales surged by 49.7% to $463.3 million, highlighting the company's successful expansion into new markets [7]. - Growth in international markets was particularly driven by Europe and China, as Deckers expands its distribution in Europe [7]. Future Outlook - Management anticipates continued solid growth for its core brands, projecting mid-teens growth for Hoka and mid-single-digit growth for Ugg for the remainder of the year [8]. - Deckers has a strong historical performance, with stock appreciation of over 1,000% in the last decade, despite recent declines [9]. Brand Strength - Deckers has successfully developed its brands, particularly Hoka, which is gaining market share due to its popularity among runners and professionals [11]. - The company has a strong track record of acquiring and growing brands, having transformed both Ugg and Hoka into multibillion-dollar entities [10]. Cost Considerations - Deckers expects a $185 million impact on the cost of goods sold due to tariffs, but this is not seen as a justification for the significant market cap loss of approximately $15 billion [12].

We got a lot of reports. We heard from a lot of the discount retailers. You have a new buy on a stock that's having its best month since November.It's up 12% month to date and it is >> Deckers. I've never owned it before actually, Scott. But why now. >> I've uh Well, why now.Is because they have very strong brands. I'm a big believer in Hoka myself personally, but the numbers speak for themselves. It's growing Hoka about 20% and they're guiding double digit growth for the rest of the year for Hoka.UGG actua ...

Core Insights - Deckers Outdoor Corporation's international business is a key growth driver, with HOKA and UGG showing strong performance abroad, particularly in the first quarter of fiscal 2026 where international revenues increased by 49.7% year over year to $463.3 million, significantly outperforming U.S. sales [1][10] International Business Performance - HOKA's international growth is robust, especially in the EMEA region, with record European reorders and strong consumer acquisition. Key products like Bondi, Clifton, and Arahi are leading sales, with Bondi and Clifton being top U.S. running franchises and doubling volumes in China for spring/summer 2025 [2] - UGG has also seen strong international growth, particularly in Europe and China. The brand's 365 strategy has expanded its appeal beyond cold-weather items, with new styles like the PeakMod clog gaining popularity, supported by effective marketing campaigns [3] Infrastructure and Strategic Investments - To meet rising demand, Deckers has invested in infrastructure, including changing its EMEA logistics provider and opening new stores in cities like Berlin, Milan, and various locations in China. These initiatives aim to enhance retail presence and build long-term brand equity [4] Future Outlook - Management anticipates that international markets will continue to outpace U.S. growth, with HOKA positioned as the fastest-growing brand and UGG expanding its seasonal and demographic reach. The goal is to increase international sales to 50% of total revenues, creating a more balanced and resilient business model [5] Competitive Landscape - In comparison, Steven Madden, Ltd. reported an 8% year-over-year increase in international revenues for the second quarter of 2025, while Wolverine World Wide, Inc. saw a 15.7% increase to $250 million, both outpacing U.S. sales [6][7][8] Valuation and Earnings Estimates - Deckers shares have declined by 46.3% year to date, contrasting with the industry's decline of 9.6%. The company trades at a forward price-to-earnings ratio of 16.80X, below the industry average of 18.22X [9][12] - The Zacks Consensus Estimate for Deckers' fiscal 2026 earnings suggests a slight decline of 0.6%, while fiscal 2027 indicates an 8.3% increase, with recent upward revisions in earnings estimates for both fiscal years [13]

Core Insights - The athletic footwear market is experiencing intensified competition, with NIKE Inc. and Deckers Outdoor Corporation as key players attracting investor interest [2] - The question arises regarding which stock presents greater upside potential in the near future [2] NIKE Overview - NIKE maintains its status as a global brand leader, with strong cultural and performance influence through its brands like NIKE, Jordan, and Converse [3] - In fiscal 2025, NIKE regained momentum through significant sports events, enhancing its emotional connection with consumers [3] - Performance categories showed strong results, with running sales growing in the high-single digits and women's basketball sales increasing over 50% year-over-year [4] - Marketplace strategies, including collaborations with DICK'S Sporting Goods and JD Sports, have improved sell-through rates and in-store experiences [5] - However, NIKE faced financial challenges, with Q4 revenues declining 12% to $11.1 billion and gross margins contracting 440 basis points to 40.3% due to discounting and supply chain issues [6] - Greater China remains a challenge, with revenues down 20% and EBIT declining 45%, indicating a slower recovery compared to other regions [7] Deckers Overview - Deckers is experiencing strong growth, particularly in its HOKA and UGG brands, with HOKA sales rising 19.8% to $653.1 million and UGG sales climbing 18.9% to $265.1 million [8] - International markets are a significant growth driver, with companywide international revenues increasing 49.7% year-over-year [9] - Deckers' innovation and brand storytelling are central to its strategy, with ongoing product development and new launches [11] - The company's omni-channel and wholesale strategies are yielding scalable growth, with wholesale net sales rising 26.7% in the first quarter [12] - Despite challenges such as anticipated tariff costs and profitability pressures, Deckers is well-positioned for sustainable growth [13] Comparative Analysis - The Zacks Consensus Estimate for NIKE suggests declines in sales and EPS for fiscal 2026, with a 10.6% downward revision in EPS estimates over the past 60 days [14] - In contrast, Deckers' estimates imply a 9% growth in sales for fiscal 2026, with a slight decline in EPS, but a 4% increase in EPS estimates over the past 60 days [17] - Stock performance over the past three months shows DECK shares rising 3.6%, while NKE shares gained 26.9%, reflecting NIKE's stronger brand momentum [19] - Valuation metrics indicate NIKE's forward P/E at 40.28, significantly higher than Deckers' 16.13, suggesting NIKE is pricier relative to historical levels [21] Investment Outlook - Deckers is positioned as a stronger investment candidate due to robust growth in HOKA and UGG, international expansion, and a healthy product pipeline [24] - NIKE, while investing in innovation and digital transformation, faces near-term challenges from revenue declines and margin pressures, making Deckers a more favorable option to hold [25]

Group 1 - Amrita leads a boutique family office fund in Vancouver, focusing on sustainable, growth-driven investments that maximize shareholder equity [1] - The fund aims to meet growth-oriented goals while democratizing financial literacy and simplifying complex macroeconomic concepts [1] - Amrita has a background in high-growth supply-chain start-ups and has experience working with venture capital firms, enhancing user acquisition during the pandemic [1] Group 2 - Amrita co-founded an award-winning newsletter, The Pragmatic Optimist, which emphasizes portfolio strategy, valuation, and macroeconomics [1] - The newsletter has been recognized as the Top Newsletter in Finance on popular platforms, indicating its influence and reach [1] - Amrita plans to extend her ideas and insights to Seeking Alpha, further broadening her audience [1]