Investment Rating - Buy (maintained) [1] Core Views - Revenue and EPS exceeded expectations, with significant improvement in profit margins [1][3] - FY2025Q1 revenue was $830 million, up 22% YoY, and OP was $130 million, up 87.8% YoY [1] - Net profit was $120 million, up 81.9% YoY, with a net margin of 14%, up 4.6pct YoY [1] - Diluted EPS was $4.52, compared to $2.41 in the same period last year [1] - HOKA brand revenue grew 29.7% YoY to $545 million, driven by strong sales of core products and new product launches [3] - UGG brand revenue increased 14% YoY to $223 million, with wholesale revenue up 18% due to replenishment demand [3] - The company raised its FY2025 revenue guidance to $4.7 billion, up 10% YoY, and adjusted its EPS guidance to $29.75-$30.65 [3][6] Financial Performance - FY2025Q1 GPM was 56.9%, up 5.6pct YoY, driven by higher-margin products and increased full-price sales [1][3] - OPM improved to 16.1%, up 5.6pct YoY [1] - Inventory at the end of the quarter was $750 million, up 1.7% YoY, reflecting healthy inventory levels [3] - US revenue grew 23% YoY to $516 million, while international revenue increased 20.8% YoY to $310 million, with strong performance in China and EMEA [3] Brand Performance - HOKA's DTC revenue grew 33% YoY to $210 million, and wholesale revenue increased 28% YoY to $330 million [3] - UGG's DTC revenue rose 8% YoY to $80 million, while wholesale revenue surged 18% YoY to $143 million [3] - Teva revenue declined 4.3% YoY to $46 million, and Sanuk revenue fell 28.4% YoY to $6.9 million [3] - Other brands, including Koolaburra, saw revenue increase 123.5% YoY to $4 million [3] Future Outlook - The company expects FY2025 revenue to grow 10% YoY to $4.7 billion, with GPM guidance raised to 54% [3][6] - OPM guidance is revised to 19.5%-20%, and SG&A expense ratio is expected to be 34%-34.5% [6] - HOKA is projected to grow 20% YoY in FY2025, while UGG is expected to grow in the mid-single digits [6] - Sanuk brand is set to be divested in August 2024, and a new CEO will take over on August 1, 2024 [6] Valuation and Forecast - The company is expected to achieve revenue of $4.79 billion, $5.29 billion, and $5.81 billion in FY2025, FY2026, and FY2027, respectively, with YoY growth of 11.8%, 10.3%, and 9.8% [7] - Net profit is forecasted to be $788 million, $882 million, and $965 million for FY2025, FY2026, and FY2027, respectively [7] - Diluted EPS is projected to be $30.2, $33.9, and $37.0 for FY2025, FY2026, and FY2027, respectively [7] - The stock's P/E ratio is 30.7x, 27.4x, and 25.0x for FY2025, FY2026, and FY2027, respectively [7]

Deckers Outdoor Corporation (NYSE:DECK), together with its subsidiaries, designs, markets, and distributes footwear, apparel, and accessories for casual lifestyle use and high-performance activities in the United States and internationally. We have started covering this company in May 2024, primarily due to the extraordinary popularity of its UGG and HOKA brands in the recent past. At that time, we have rated the company's stock as "Hold", due to the perceived limited upside potential, based on its fundamen ...

For the current quarter, Deckers is expected to post earnings of $7.03 per share, indicating a change of +3.1% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.5% over the last 30 days. The consensus earnings estimate of $31.33 for the current fiscal year indicates a year-over-year change of +7.4%. This estimate has changed +2.1% over the last 30 days. For the next fiscal year, the consensus earnings estimate of $35.08 indicates a change of +12% from what Deckers is expected to report ...

Robert Way/iStock Editorial via Getty Images I last covered Deckers Outdoor Corporation (NYSE:DECK) on June 6th, where I believed that the stock was overvalued with excessive investor optimism baked into its valuation, making it prone to a sharp pullback, especially as revenue growth rates slow from their prior levels. I did emphasize, however, that the company had been operating resiliently, as it saw its HOKA and UGG brands continuing to outperform as it leveraged a robust product portfolio. It is also ma ...

Deckers owns various shoe brands including its big two brands, Hoka and Ugg. Net sales for both of these brands were up in Q1, leading to overall revenue growth of 22%. The company's Q1 gross margin of nearly 57% was up sharply from a gross margin of just north of 51% in the prior-year period. And this major improvement led to strong bottom-line profitability. Shares of shoe company Deckers Outdoor (DECK 8.12%) jumped on Friday after the company reported financial results for its fiscal first quarter of 202 ...

The Zacks Consensus Estimate for Abercrombie & Fitch's current financial-year revenues and earnings calls for growth of 10.4% and 47.3%, respectively, from the year-ago reported figures. Abercrombie & Fitch has a trailing four-quarter earnings surprise of 210.3%, on average. SG&A expenses climbed 22.3% year over year to $337.2 million. As a percentage of net sales, SG&A stood at 40.9%, 10 basis points higher than the last year. We had anticipated a year-over-year increase of 20.4% in the metric. The company ...

The footwear company's quarterly gross margin was 56.9% compared to 51.3% a year ago. Operating income was $132.8 million compared to $70.7 million a year earlier. During the first fiscal quarter, the company repurchased approximately 177 thousand shares of its common stock for a total of $152.0 million at a weighted average price paid per share of $858.79. Photo by Nattawit Khomsanit via Shutterstock Deckers Outdoor Corporation DECK shares are trading higher today. Check This Out: Deckers Outdoor Q1 Earnin ...

Deckers Brands (DECK) shares surged Friday, a day after the footwear company released earnings that showed sales for its popular brands Hoka and Uggs jumped 30% and 14%, respectively, compared to the same time last year. Key Takeaways Deckers reported $825.3 million in sales for the first quarter of fiscal 2025, up just over 22% from $675.8 million a year ago, and above analysts' expectations, according to estimates compiled by Visible Alpha. Popularity of Hoka, Uggs Boost Sales Much like it reported in May ...

Financial Data and Key Metrics - SG&A expenses in Q1 were $337 million, up 22% YoY from $276 million, representing 40.9% of revenue compared to 40.8% last year [2] - Tax rate was 22.5%, up from 21.9% in the prior year, contributing to diluted EPS of $4.52, an 87% increase YoY from $2.41 [3] - Cash and equivalents stood at $1.44 billion as of June 30, 2024, with inventory up 2% YoY to $753 million [4] - The company repurchased $152 million worth of shares at an average price of $858.79, with $790 million remaining under the stock repurchase authorization [4] Business Line Performance - HOKA brand revenue increased 30% YoY to $545 million, driven by strong demand for key styles like Clifton and Bondi, as well as emerging franchises like Mach, Transport, and Kawana [88] - UGG brand revenue grew 14% YoY to $223 million, driven by strong full-price selling of iconic franchises and increased adoption of the Golden Collection [36] - HOKA's DTC revenue increased 33% YoY, while wholesale revenue grew 28% YoY, reflecting balanced growth across channels [35] Market Performance - HOKA experienced robust growth in international markets, particularly in China and EMEA, with DTC growth of 31% in the US and 21% internationally [62] - UGG saw strong DTC performance in both the US and international regions, with the Tasman franchise and Golden Collection driving year-round demand [37] Strategic Direction and Industry Competition - The company is focused on expanding HOKA's global awareness and market share, particularly in international markets, while enhancing DTC growth through consumer acquisition and retention [90] - UGG is leveraging collaborations and marketing activations to maintain consumer interest and drive year-round demand for its products [10][11] - The company is investing in innovation, with new HOKA styles like Skyward X and Cielo X1 performing well and driving incremental volume [88] Management Commentary on Operating Environment and Future Outlook - Management expects total company revenue to grow approximately 10% YoY to $4.7 billion in FY2025, with HOKA growing 20% and UGG growing in the mid-single-digit range [23] - Gross margin is expected to increase to 54%, up 50 basis points from prior guidance, driven by strong Q1 results [23] - The company anticipates a more normalized promotional environment in FY2025, with higher freight costs impacting margins in the remaining quarters [24] Other Important Information - The company divested the Sanuk brand, which has been removed from forward-looking guidance [41] - A 6-for-1 forward stock split has been approved, pending stockholder approval at the 2024 Annual Meeting [42] Q&A Session Summary Question: Capital Allocation Priorities - The company is focused on organic growth and maintaining a strong balance sheet, with share repurchases remaining a priority. Dividends and M&A are under discussion but no announcements have been made [33][56] Question: HOKA's Momentum and Distribution Strategy - HOKA's strong performance is attributed to its global multichannel strategy, with balanced growth across DTC and wholesale channels. The company is confident in achieving its 20% growth target for the year [38][50] Question: New Product Launches and Segmentation - HOKA's Mach 6 and Skyflow launches have been successful, with the Mach 6 becoming a top 5 revenue style. The company is focusing on segmentation to differentiate products across distribution points [19][52] Question: HOKA Apparel and Revenue Shape - HOKA's apparel launch, Airolite, is performing well in limited distribution. The company is investing in leadership and infrastructure to expand its apparel offerings [57][58] Question: Freight Costs and Margin Impact - Freight costs are expected to be a headwind for the remainder of FY2025, with a negative 80 basis points impact on margins [70] Question: Inventory and Order Book Trends - Inventory is up 2% YoY, with UGG in a strong position heading into the fall season. The company's order book reflects demand exceeding supply, indicating a healthy marketplace [130][133] Question: HOKA DTC Growth and International Expansion - HOKA's DTC growth is driven by strong performance in North America and international markets, with Asia showing promising growth potential [134][135] Question: Store Expansion Strategy - The company is taking a strategic approach to store expansion, focusing on flagship locations in key cities for UGG and a more aggressive retail build-out for HOKA in international markets [145]

It's tough to get a firm handle on this market. One day it looks like a trading rotation into undervalued equities from big run-ups elsewhere, the next day it's a major selloff across the board. This day, we were back to the "rotation" scenario: the Dow gained +81 points, +0.20%, and the small-cap Russell 2000 kept up its two-week dominance, +1.47%, while the S&P 500 sold off another -0.51% and the Nasdaq -0.93% following the singleworst trading day of 2024 (so far). Two major retailers reported this aftern ...