Deckers Outdoor (DECK) Stock Forecast & Price Target

Deckers Outdoor demonstrated strong revenue growth in fiscal 2025, reporting a 17.1% year-over-year increase to $1.83 billion, driven primarily by the robust performance of its HOKA and UGG brands, which grew 23.7% and 16.1% respectively. Future projections indicate continued expansion, with expectations for net sales to reach $4.95 billion, reflecting a 15.5% growth, supported by anticipated growth rates of 24.8% for HOKA and 10.8% for UGG. Additionally, the company's gross margin is expected to improve to 57.2%, showcasing effective brand and product mix management and the strength of higher-margin sales, indicating a solid financial foundation for the company moving forward.

Deckers Outdoor faces challenges with anticipated flat or negative growth for its UGG brand in the second half of fiscal 2025, attributed to difficult year-over-year comparisons and reduced inventory availability post-Holiday. The company's guidance indicates a potential decline in UGG revenues by mid-teens, which could lead to a slowdown in overall consolidated revenue growth to just 0.8% year-over-year for the fourth quarter, while projecting significant operating margin contraction. Additionally, expected EPS for the fourth quarter has been revised downward to $0.47, reflecting broader pressures from deteriorating gross margins due to various headwinds, further impacting the company's financial outlook.