Analyst Turns More Bullish on Long-Term Growth
Deckers Outdoor Corporation (NYSE:DECK) shares gained 3.5% on Monday after Jefferies upgraded the footwear maker to Buy from Hold and increased its price target to $130 from $110.
The brokerage cited growing confidence in the company’s ability to deliver sustainable revenue growth and maintain healthy profit margins over the coming years.
Medium-Term Outlook Supports Upgrade
Jefferies analyst Blake Anderson highlighted the medium-term guidance issued during Deckers’ fourth-quarter earnings call as a key factor behind the upgrade.
Management expects high-single-digit revenue growth, operating margins to remain in the low-20% range and low-double-digit earnings per share growth, supported by ongoing share repurchases.
Lower Valuation Seen as Opportunity
Although Anderson expects EBIT growth to moderate to approximately the high-single-digit range, compared with a compound annual growth rate of around 20% over the past six years, he believes the slower growth profile is already reflected in the stock’s valuation.
The analyst noted that Deckers’ price-to-earnings multiple has declined from around 33x to approximately 13x.
Commenting after meeting management at Jefferies’ Nantucket conference, Anderson said: “After spending more time w/ mgmt. at our recent Nantucket conference, we walked away better appreciating mgmt’s ability to drive both durable growth and margins.”
Stifel Also Maintains Positive View
Separately, Stifel reaffirmed its Buy rating on Deckers and maintained a $144 price target.
Analyst Peter McGoldrick expects the company to outperform current market estimates and modestly increase its fiscal 2027 guidance following first-quarter results.
He also highlighted the launches of the HOKA Clifton 11 and Clifton Pro models, both introduced at higher average selling prices, as positive catalysts for the brand.
Analysts See Room for Higher Guidance
Stifel believes fiscal 2027 revenue guidance could increase by approximately $20 million.
The brokerage also views the company’s gross margin outlook as conservative, suggesting there could be an additional $50 million to $100 million of upside as the financial year progresses.