Where Will Deckers Outdoor Stock Be in 1 Year?

Core Viewpoint - Deckers Outdoor has seen a significant increase in its stock price, up 95% this year, driven by the success of its HOKA brand and strong earnings growth [1][2]. Financial Performance - In the first quarter of fiscal 2025, Deckers Outdoor reported a revenue increase of 22%, with HOKA brand sales growing by 30% [5]. - Earnings per share (EPS) for the same period reached $4.52, an 88$4.7 billion, a 10% increase from the previous year, with EPS growth projected between 2% and 5% [7]. Brand Portfolio and Growth Drivers - Deckers owns several brands, including the iconic UGG and the smaller Teva, with HOKA being the most significant growth driver since its acquisition in 2012 for $1.1 million [3][4]. - HOKA is projected to generate over$2 billion in sales this year, contributing to a 584% stock return over the past five years [4]. Market Position and Competitive Landscape - Deckers is performing well compared to competitors like Nike and Lululemon, which are experiencing sluggish demand, allowing Deckers to capture market share [9]. - The company plans to expand internationally and enter new product categories, including apparel, to leverage brand momentum [10]. Financial Health - Deckers has a strong balance sheet with $1.4 billion in cash and no financial debt, and it has repurchased$152 million in shares in Q1 [8]. - The forward price-to-earnings (P/E) ratio is 30, which is a premium compared to peers like Nike and Lululemon, but justified by the company's financial strength [12]. Future Outlook - The company is expected to gradually shift from a footwear focus to a broader lifestyle portfolio, which could positively impact earnings [11]. - Overall, the stock is viewed as a strong investment opportunity, with expectations for continued growth as long as macroeconomic conditions remain favorable [14].