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Deckers (DECK) Stock Sinks As Market Gains: Here's Why

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In the latest market close, Deckers (DECK - Free Report) reached $939.05, with a -1.43% movement compared to the previous day. The stock's performance was behind the S&P 500's daily gain of 0.07%. Meanwhile, the Dow lost 0.13%, and the Nasdaq, a tech-heavy index, added 0.14%.

Shares of the maker of Ugg footwear witnessed a loss of 9.69% over the previous month, trailing the performance of the Retail-Wholesale sector with its gain of 2.94% and the S&P 500's gain of 4.34%.

The upcoming earnings release of Deckers will be of great interest to investors. The company's earnings per share (EPS) are projected to be $3.50, reflecting a 45.23% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $804.99 million, indicating a 19.12% increase compared to the same quarter of the previous year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $30.59 per share and revenue of $4.76 billion. These totals would mark changes of +4.9% and +11.04%, respectively, from last year.

Any recent changes to analyst estimates for Deckers should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. At present, Deckers boasts a Zacks Rank of #3 (Hold).

Looking at valuation, Deckers is presently trading at a Forward P/E ratio of 31.14. This expresses a premium compared to the average Forward P/E of 14.94 of its industry.

We can also see that DECK currently has a PEG ratio of 3.18. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Apparel and Shoes industry had an average PEG ratio of 2.19 as trading concluded yesterday.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 98, finds itself in the top 39% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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