Maxim G.
2 min read
In This Article:
Following the Q4 2025 results announced on May 22nd, an analyst from Telsey Advisory Group downgraded Deckers Outdoor Corporation (NYSE:DECK) stock to Market Perform from Outperform and significantly cut its price target from $240 to $120. Despite a strong fourth quarter and the full-year revenue growth coming in at 16% YoY, Telsey mentioned that weakness in the HOKA brand and DTC business, coupled with unfavorable shift-to-wholesale trend and tariff-related costs, will negatively weigh on the company's future potential.
A customer browsing a retail store, finding the perfect footwear for their casual outfits.
Markets have already anticipated the headwinds as DECK stock is more than 40% below its last 12-month high from January 2025. Management confirmed that the profitability outlook is pressured and expects Gross Margins to decline by 250 bps next year relative to the record 57.9% achieved in fiscal 2025.
Besides tariff-related inflation in its cost of goods, Deckers Outdoor Corporation (NYSE:DECK) also faces higher freight costs and the need to increase its marketing expenses. The main danger of inflationary pressures in consumer discretionary goods is the possibility of seeing demand erosion if the goods become too pricey for the already pressured consumers.
Deckers Outdoor Corporation (NYSE:DECK) is a California-based global designer and manufacturer of innovative footwear, apparel, and accessories, focusing on both casual and high-performance markets through brands such as UGG, HOKA, and Teva.
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Disclosure: None.
