Deckers Outdoor Corporation, with its headquarters in Goleta, CA, has seen a robust surge in the stock market, posting a strong 38.2% rise, outpacing the industry’s 27.5% growth over the last six months. This impressive trajectory is predominantly due to the exceptional market reception of its UGG and HOKA brands, particularly in the direct-to-consumer segment. As a Zacks Rank #2 (Buy) company, Deckers’ formidable operational strategy and resilient balance sheet have been instrumental in driving this growth.
Strategic Investments for Long-Term Success
Deckers’ growth strategy includes firm commitments to strategic investments in innovation, marketing, and talent development, essential for securing long-term success. These investments are pivotal in sustaining the company’s growth trajectory as it plans to further enhance its infrastructure capabilities to efficiently meet evolving customer demands. An integral part of this strategy revolves around bolstering global consumer awareness and adoption, achieved through launching innovative product offerings and executing global marketing campaigns that resonate with diverse consumer segments.
Moreover, Deckers is focused on its marketplace management strategy, particularly in Europe and Asia. This involves building brand acceptance and creating brand ‘heat’ through localized marketing initiatives.
Looking into fiscal 2024, Deckers is on a trajectory for significant growth, with a projected revenue of $4.025 billion. This estimate indicates an 11% increase from the previous year, underscoring the company’s robust market presence and effective business strategies. This anticipated growth is powered by the performance of Deckers’ leading brands, UGG and HOKA.
The company aims to maintain a competitive edge with a gross margin between 52.5% and 53% and an operating margin of about 18.5%. Additionally, DECK targets EPS in the range of $22.90-$23.25, reflecting its strong financial health and confidence in continued profitability.
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Resilient Financial Growth
Deckers stands as a resilient force in the market, supported by a robust growth trajectory, strategic investments, and a commitment to global expansion. Investors eyeing promising growth prospects may find Deckers an enticing addition to their portfolios.
The Zacks Consensus Estimate projects a robust top-line growth of 11.7% and a bottom-line increase of 21.9% for the current fiscal year, and this trend is expected to extend into the next fiscal period. DECK has consistently delivered an average earnings surprise of 26.3% over the trailing four quarters, underscoring its strong financial management and market performance.
Deckers’ robust financial results and strategic expansion of its brands position it as an attractive investment choice for 2024, with the potential to deliver returns that outperform the market.
Other Key Picks
Hibbett Sports, an athletic-inspired fashion-focused company, currently sports a Zacks Rank #1 (Strong Buy). HIBB delivered an average earnings surprise of 24.17% for the trailing four quarters.
The Zacks Consensus Estimate for Hibbett Sports’ current fiscal-year sales suggests growth of 1.7% from the year-ago reported number. The consensus estimate for EPS indicates a decline of 15.1% from the year-ago reported figure.
Abercrombie & Fitch, operating as a specialty retailer of premium, high-quality casual apparel for men, women, and kids, flaunts a Zacks Rank #1. ANF delivered an average earnings surprise of 712.9% in the trailing four quarters.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and earnings suggests growth of around 15% and 2320%, respectively, from the year-ago reported numbers.
The Gap, a premier international specialty retailer, sports a Zacks Rank #1. GPS delivered a trailing four-quarter earnings surprise of 137.8%, on average.
The Zacks Consensus Estimate for The Gap’s current fiscal-year sales suggests a decline of 5.1% from the year-ago actual. The consensus estimate for EPS implies 387.5% growth from the year-ago reported level.
Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
Deckers Outdoor Corporation (DECK) : Free Stock Analysis Report
The Gap, Inc. (GPS) : Free Stock Analysis Report
Hibbett, Inc. (HIBB) : Free Stock Analysis Report
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