Deckers(US:DECK) ZACKSยท2025-02-07 15:11Core Viewpoint - Deckers Outdoor Corporation has reported strong third-quarter fiscal 2025 results, driven by the performance of its HOKA and UGG brands, leading to an optimistic outlook for the fiscal year [1][2][4]. Financial Performance - Deckers achieved a 23.7% year-over-year increase in HOKA sales, totaling $530.9 million, surpassing the projected $514 million [2]. - UGG brand net sales grew by 16.1% to $1,244 million, exceeding the estimate of $1,082.8 million [2]. - The company ended the quarter with a cash position of $2,240.9 million and no outstanding borrowings, indicating strong financial health [3]. - Inventory levels were managed well at $576.7 million, reflecting a 7% year-over-year increase [3]. Future Outlook - Deckers anticipates a 15% increase in fiscal 2025 net sales, reaching $4.9 billion, with HOKA expected to grow by around 24% and UGG by 10% [4]. - Earnings per share for fiscal 2025 are projected to be between $5.75 and $5.80, up from $4.86 reported last year [4]. Analyst Consensus - The Zacks Consensus Estimate for earnings per share has been revised upward by 2.6% to $5.83 for the current fiscal year and by 0.9% to $6.55 for the next fiscal year [5]. - However, estimates for the final quarter of fiscal 2025 have been lowered by 18.3% to 58 cents due to anticipated slower growth and increased cost pressures [6]. Market Positioning - Deckers is well-positioned in the competitive retail apparel and shoes industry, with a strong brand portfolio and innovative product launches [9][10]. - The company has been expanding its global footprint, particularly in Europe and China, with international net sales rising 28.5% to $657.9 million in Q3 [12]. - Direct-to-consumer net sales advanced 17.9% to $1,011 million, with comparable net sales surging 18.3% [12]. Stock Valuation - Despite a recent 17% decline in stock price, Deckers trades at a premium with a forward price-to-earnings ratio of 26.71, higher than the industry average of 20.19 [13][14].