Footwear Maker Deckers Outdoor is Upgraded to BUY by ValuEngine

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For today’s bulletin, we take a look at our latest STRONG BUY and BUY upgrades. We also provide a link to download a FREE STOCK REPORT on Deckers Outdoor $DECK, one of our top upgrades for the day.

VALUATION WATCH: Overvalued stocks now make up 23.59% of our stocks assigned a valuation and 8.44% of those equities are calculated to be overvalued by 20% or more. One sector is calculated to be overvalued.

For today’s edition of our upgrade list, we used our website’s advanced screening functions to search for UPGRADES to BUY or STRONG BUY with complete forecast and valuation data. They are presented by one-month forecast return. There were no STRONG BUY upgrades. Today, every component of our top-five list is a BUY upgrade.

Ticker Company Name Market Price Valuation Last 12-M Return 1-M Forecast Return 1-Yr Forecast Return P/E Ratio Sector Name
TSM TAIWAN SEMI-ADR 36.76 2.62% -6.70% 0.53% 6.38% 16.29 Computer and Technology
DECK DECKERS OUTDOOR 122 3.46% 58.20% 0.51% 6.14% 17.30 Consumer Discretionary
S SPRINT CORP 5.91 -7.64% 5.54% 0.51% 6.10% 65.67 Utilities
DRI DARDEN RESTRNT 103.85 0.20% 14.70% 0.51% 6.07% 19.37 Retail-Wholesale
DLTR DOLLAR TREE INC 85.86 -0.51% -21.30% 0.50% 6.04% 15.84 Retail-Wholesale

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Deckers Outdoor Corporation (DECK) is a global leader in designing, marketing and distributing innovative footwear, apparel and accessories developed for both everyday casual lifestyle use and high performance activities. The Company’s portfolio of brands includes UGG, Koolaburra, HOKA ONE ONE, Teva and Sanuk. Deckers Brands products are sold in more than 50 countries and territories through select department and specialty stores, Company-owned and operated retail stores, and select online stores, including Company-owned websites. Deckers Brands has an history of building niche footwear brands into lifestyle market leaders attracting millions of loyal consumers globally.

If you ever wear sport sandals, you are most likely familiar with Deckers Outdoor. They own popular brands such as Teva. If you know a woman of a certain age, they probably wear UGGs, another one of Deckers leading brands. The company is popular with investors and, lately, some hedge funds. DE Shaw, AQR Capital Management, and GLG Partners are some of the players with positions in this stock.

The last results were published at the end of October, and at that time the company posted some decent numbers for Q2 2018. Net sales increased 4.0% to $501.9 million compared to $482.5 million for the same period last year. Gross margin was 50.2% compared to 46.7% for the same period last year. Operating income was $90.4 million compared to $67.4 million for the same period last year. Diluted earnings per share were $2.48 compared to $1.54 for the same period last year. Non-GAAP diluted earnings per share was $2.38 this year compared to $1.54 last year. Decker saw decent growth for HOKA ONE ONE with a sales increase of 28%. Other flagships held steady or suffered slight declines.

The company is due to report Q3 earnings in January. Their current outlook is for Net sales to be in the range of $805.0 million to $825.0 million. Non-GAAP diluted earnings per share are expected to be in the range of $5.10 to $5.25.

For the fiscal year, Net sales are now expected to be in the range of $1.935 billion to $1.960 billion. Gross margin is now expected to be approximately 50%. Non-GAAP diluted earnings per share are now expected to be in the range of $6.65 to $6.85.

ValuEngine updated its recommendation from HOLD to BUY for Deckers Outdoor Corporation on 2018-12-18. Based on the information we have gathered and our resulting research, we feel that Deckers Outdoor Corporation has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE Momentum and Company Size.

You can download a free copy of detailed report on Deckers Outdoor Corporation (DECK) from the link below.

ValuEngine Forecast
1-Month 122.62 0.51%
3-Month 123.37 1.13%
6-Month 126.60 3.77%
1-Year 129.49 6.14%
2-Year 133.59 9.50%
3-Year 142.59 16.88%
Valuation & Rankings
Valuation 3.46% overvalued Valuation Rank(?) 20
1-M Forecast Return 0.51% 1-M Forecast Return Rank 85
12-M Return 58.19% Momentum Rank(?) 97
Sharpe Ratio 0.31 Sharpe Ratio Rank(?) 76
5-Y Avg Annual Return 9.55% 5-Y Avg Annual Rtn Rank 81
Volatility 30.98% Volatility Rank(?) 50
Expected EPS Growth 3.31% EPS Growth Rank(?) 27
Market Cap (billions) 4.23 Size Rank 81
Trailing P/E Ratio 17.31 Trailing P/E Rank(?) 58
Forward P/E Ratio 16.75 Forward P/E Ratio Rank 33
PEG Ratio 5.23 PEG Ratio Rank 6
Price/Sales 2.15 Price/Sales Rank(?) 41
Market/Book 5.43 Market/Book Rank(?) 22
Beta 0.81 Beta Rank 49
Alpha 0.54 Alpha Rank 96


DOWNLOAD A FREE SAMPLE OF OUR DECKERS OUTDOOR (DECK) REPORT BY CLICKING HERE is an Independent Research Provider (IRP), producing buy/hold/sell recommendations, target price, and valuations on over 5,000 US and Canadian equities every trading day.
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ValuEngine Capital Management LLC is a Registered Investment Advisory (RIA) firm that trades client accounts using ValuEngine’s award-winning stock research.
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Steve Hach
Senior Editor