Deckers Outdoor Corp

We increased our position in Deckers Outdoor Corporation (DECK) following recent weakness in the shares. While there have been concerns about the HOKA brand, recent results point to the strength and sustainability of both the UGG and HOKA brands. We believe DECK can continue to generate strong revenue growth with higher margins. The balance sheet is strong with $1.7B in net cash (10% of the company’s market cap). With shares now at a much more attractive valuation, we elected to increase our position.

We increased our position in Deckers Outdoor Corporation (DECK) following recent weakness in the shares. While there have been concerns about the HOKA brand, recent results point to the strength and sustainability of both the UGG and HOKA brands. We believe DECK can continue to generate strong revenue growth with higher margins. The balance sheet is strong with $1.7B in net cash (10% of the company’s market cap). With shares now at a much more attractive valuation, we elected to increase our position.

Deckers Outdoor Corp, which sells shoes under the Uggs, Hoka, and Teva brands, has seen its shares drop over 50% this year due to tariff uncertainties. However, we believe that at the price we bought in at $105, the company is reasonably priced at 11x EV/EBITDA compared to 9.2 for Lululemon and 24.7 for Nike. If Deckers can maintain its Hoka momentum, which has seen sales grow by 35%, it should perform well going forward. Uggs, while historically volatile, has also shown a compound sales growth of 8.4% over the past three years, indicating potential for recovery.

Deckers, which sells shoes under the Uggs, Hoka, and Teva brands, has seen its shares drop over 50% this year due to tariff uncertainties. However, we believe that at a price of $105, it is reasonably priced with an 11x EV/EBITDA compared to 9.2 for Lululemon and 24.7 for Nike. Uggs has grown sales by 8.4% over the past three years, while Hoka has seen a remarkable 35% growth. If Deckers can maintain its Hoka momentum, it should perform well going forward.

Deckers Outdoor faced significant challenges in the recent quarter, with its stock plunging in January after the firm's fiscal-year revenue forecast fell short of Wall Street analysts' expectations. Despite reporting higher sales in its two crucial brands, UGG® and HOKA®, there are concerns regarding the company's expansion capabilities amid declining sales in its largest market, the U.S., and other challenges. This underperformance has led to an underweight position in the fund.

Deckers Outdoor faced significant challenges in the recent quarter, with its stock plunging in January after the firm's fiscal-year revenue forecast fell short of Wall Street analysts' expectations. Despite reporting higher sales in its two crucial brands, UGG® and HOKA®, there are concerns regarding the company's expansion capabilities amid declining sales in its largest market, the U.S., and other challenges. This underperformance has led to an underweight position in the fund.

Deckers Outdoor faced significant challenges in the recent quarter, with its stock plunging in January after the firm's fiscal-year revenue forecast fell short of Wall Street analysts' expectations. Despite reporting higher sales in its two crucial brands, UGG® and HOKA®, there are concerns regarding the company's expansion capabilities amid declining sales in its largest market, the U.S., and other challenges. This underperformance has led to an underweight position in the fund.