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Here's How Deckers (DECK) Is Steadily Expanding Presence

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Deckers Outdoor Corporation (DECK - Free Report) focuses on profitable and underpenetrated markets through product innovation, store expansion and enhanced e-commerce capabilities.

The company is expanding its brand assortments, particularly the UGG and HOKA brands, with a focus on targeting consumers digitally and optimizing their omni-channel distribution. The UGG brand's diverse product line is gaining greater acceptance, and the company's progress in Europe and the Asia Pacific is promising.

The HOKA brand is actively building its customer base by combining disruptive product innovation and disciplined marketing strategies. Deckers aims to elevate HOKA into a multibillion-dollar major player in the market. Additionally, the company is working on transforming UGG into a global lifestyle brand with a wide range of products available throughout the year.

 

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The company is also focusing on enhancing its direct-to-consumer (DTC) business model. DTC net sales rose 35.3% to $250.4 million, while comparable DTC net sales jumped 33.4% in the first quarter of fiscal 2024.

As part of its growth strategy, Deckers plans to open more retail stores for the HOKA brand and continues to explore opportunities to strategically expand the HOKA brand's retail store presence. Overall, the company seems to be focused on capitalizing on market trends, innovation and brand expansion to achieve sustained growth and success. HOKA brand’s net sales climbed 27.4% to $420.5 million in the first quarter of fiscal 2024.

Deckers is evidently adapting to evolving market trends by actively developing its e-commerce platform to capture additional sales opportunities. The company has been making significant investments to strengthen its online presence and provide an improved shopping experience for its customers.

Despite the aforementioned tailwinds, investors must consider competitive dynamics, economic shifts and other risk factors such as high SG&A expenses and adverse currency headwinds. A prudent evaluation of these facets is essential for investors aiming to capitalize on the company's growth potential.

Wrapping Up

Deckers’ strategic endeavors have translated into favorable financial performance. In the first quarter of fiscal 2024, the company surpassed expectations, with its top and bottom-line figures seeing year-over-year growth, backed by strength in the HOKA brand, as well as solid gains from the direct-to-consumer channels. (Read More: Deckers Q1 Earnings & Sales Beat, FY24 EPS View Rises)

Deckers envisions net sales of $3.980 billion for fiscal 2024, up from the earlier stated $3.950 billion. This suggests an increase of 10% from the $3.627 billion reported in fiscal 2023. The company expects fiscal 2024 earnings of $21.75-$22.25 per share, up from the $21.10-$21.60 per share stated earlier.

The Zacks Rank #3 (Hold) stock has rallied 71.2% in the past year against the industry’s decline of 1.1%. DECK has also outpaced the consumer discretionary sector’s rise of 2.1%.

3 Promising Staple Stocks

Here we have highlighted three better-ranked stocks, namely Skechers U.S.A., Inc. (SKX - Free Report) , American Eagle Outfitters Inc. (AEO - Free Report) and Crocs, Inc. (CROX - Free Report) .

Skechers designs, develops, markets and distributes footwear. It currently sports a Zacks Rank #1 (Strong Buy). The expected EPS growth rate for three to five years is 28.3%.

You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Skechers’ current financial-year sales and earnings suggests growth of 8.5% and 41.2%, respectively, from the year-ago reported figures. SKX has a trailing four-quarter earnings surprise of 39.1%, on average.

American Eagle is a specialty retailer of casual apparel, accessories and footwear. The company currently has a Zacks Rank #2 (Buy). The expected EPS growth rate for three to five years is 9.6%.

The Zacks Consensus Estimate for American Eagle’ current fiscal-year earnings suggests growth of 8.3% from the year-ago reported numbers. AEO has a trailing four-quarter earnings surprise of 9.2%, on average.

Crocs is one of the leading footwear brands with a focus on comfort and style. It currently has a Zacks Rank #2. CROX delivered an earnings surprise of 20.5% in the last reported quarter.

The Zacks Consensus Estimate for Crocs’ current financial-year sales and earnings suggests growth of 12.9% and 11.2%, respectively, from the year-ago reported numbers. CROX has a trailing four-quarter earnings surprise of 19.9%, on average.


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