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Category: Stock Market and Decker Brands
Date: 24 May 2020 Stock Price: $179.24 We take a look at the 4th quarter earnings report of their 2020 fiscal year of Deckers Brands, a leading designer, marketer and distributor of innovative footwear, apparel and accessories for everyday casual and high-performance activities. The group owns brands such as Ugg and Sanuk.
Dave Powers, President and Chief Executive Officer. "We expect fiscal year 2021 results to be impacted depending on the duration and severity of the COVID-19 pandemic, but our in-demand brands, omni-channel capabilities, and healthy balance sheet position us well to weather this challenging environment" |
About Deckers Brands
Deckers Brands 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 over 40 years of history building niche footwear brands into lifestyle market leaders attracting millions of loyal consumers globally
Overview of Deckers Brands 4th quarter 2020 earnings report
- Net sales: $374.910 million (down from $394.130 million for the same quarter of the previous year)
- Net sales decreased by -4.8% over the last 12 months
- Cost of sales: $181.912 million (down from $190.825 million for the same quarter of the previous year)
- Cost of revenue decreased by -4.7% over the last 12 months
- Slight margin improvement for Deckers Brands with cost of sales increasing less than their net sales
- Net income: $16.090 million (down from $23.969 million for the same quarter of the previous year)
- Diluted earnings per share: $0.57 (down from $0.82 for the same quarter of the previous year)
- PE ratio of Deckers Brands: 18.60
- Diluted weighted-average shares outstanding: 28.279 million (down from 29.407 million for the same quarter of the previous year)
- Cash and cash equivalents: $649.436 million
- Cash and cash equivalents per share: $22.96
- Cash and cash equivalents makes up 12.8% of Deckers Brands market capital
- Cash and cash equivalents makes up 36.8% of Deckers Brands s total assets
- Trade receivable: $185.596 million
- Accounts receivable makes up 10.5% of Deckers Brands total assets
- Inventories of Deckers Brands: $311.620 million
- Inventories makes up 17.7% of Deckers Brands total assets
- Stockholders equity of Deckers Brands: $1.140 billion
- Stockholders equity per share: $40.31
- So Deckers Brands is trading at 4.44 times its stockholders equity which is well outside the expected range of between 2 and 4 times that most firms tend to trade at.
- For some perspective the average price to book value of firms in the S&P 500 is 3.7 Read more about the S&P 500 here
Deckers Brands management commentary on their 4th quarter 2020 earnings report
GOLETA, Calif., May 21, 2020 /PRNewswire/ -- Deckers Brands (NYSE: DECK), a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories, today announced financial results for the fourth fiscal quarter and fiscal year ended March 31, 2020. The Company also provided an update regarding its response to COVID-19.
"Fiscal year 2020 performance was driven by the strength of our brand portfolio, fueled by targeted investments in our key initiatives, coupled with disciplined financial management," said Dave Powers, President and Chief Executive Officer. "We expect fiscal year 2021 results to be impacted depending on the duration and severity of the COVID-19 pandemic, but our in-demand brands, omni-channel capabilities, and healthy balance sheet position us well to weather this challenging environment."
"Fiscal year 2020 performance was driven by the strength of our brand portfolio, fueled by targeted investments in our key initiatives, coupled with disciplined financial management," said Dave Powers, President and Chief Executive Officer. "We expect fiscal year 2021 results to be impacted depending on the duration and severity of the COVID-19 pandemic, but our in-demand brands, omni-channel capabilities, and healthy balance sheet position us well to weather this challenging environment."
Stock Repurchase Program
During the fourth quarter, the Company did not repurchase any shares of its common stock. As of March 31, 2020, the Company had $160 million remaining under its stock repurchase authorizations. The Company has paused share repurchase activity for the time being, but retains the discretion to commence share repurchase activity in future periods.
Financial Outlook
Given the ongoing and fluid economic environment related to the COVID-19 pandemic, the Company will not be providing full year guidance for fiscal year 2021.
COVID-19 Update
The Company continues to modify and evolve its operations in response to the COVID-19 pandemic. The Company will continue to review expert agency guidelines, as well as information from health officials and local authorities, while assessing the appropriate scope of operations and allocation of resources necessary to navigate this dynamic and unprecedented environment.
During the fourth quarter, the Company did not repurchase any shares of its common stock. As of March 31, 2020, the Company had $160 million remaining under its stock repurchase authorizations. The Company has paused share repurchase activity for the time being, but retains the discretion to commence share repurchase activity in future periods.
Financial Outlook
Given the ongoing and fluid economic environment related to the COVID-19 pandemic, the Company will not be providing full year guidance for fiscal year 2021.
COVID-19 Update
The Company continues to modify and evolve its operations in response to the COVID-19 pandemic. The Company will continue to review expert agency guidelines, as well as information from health officials and local authorities, while assessing the appropriate scope of operations and allocation of resources necessary to navigate this dynamic and unprecedented environment.
Deckers Brands (NYSE: DECK) stock price history
The image below, obtained from Google, shows the stock price history of Deckers Brands over the last 5 years. And it's been a pretty good time for Deckers Brands stockholders. 5 years ago it was trading at $68.10 and its currently trading at around $179.24 a stock. That's a very strong return of 163.2% provided to Deckers Brands stockholders over the last 5 years.
The stock of Deckers Brands is trading at a lot closer to its 52 week high of $203.19 and far away from its 52 week low of $78.70 a stock, which to us is a clear indication that the short term sentiment and momentum of Deckers Brands stock is very positive at this point in time.
The stock of Deckers Brands is trading at a lot closer to its 52 week high of $203.19 and far away from its 52 week low of $78.70 a stock, which to us is a clear indication that the short term sentiment and momentum of Deckers Brands stock is very positive at this point in time.
Decks Outdoor (NYSE: DECK) stock vs Rocky Brands (NASDAQ: RCKY) stock
The image below shows the stock price performance of Deckers Outdoor (DECK) compared to Rocky Brands (RCKY) over the last three years. Over the three year period the stock of Deckers has easily outperformed the stock of Rocky Brands, with it increasing 154.24% compared to the 37.33% return provided by Rocky Brands over the same time period.
Recent Google search trends for DECK stock price
The graphic below shows the trend in google searches for DECK stock price over the last 12 months in the United States as obtained from Google Trends. It shows that there has been fairly consistent interest in DECK stock price and that searches peaked towards the end of April 2020 and early May 2020
Recent coverage of Deckers Brands
The extract below discusses the latest on Illinois Tool Works (NYSE: ITW) as obtained from MarketBeat.com
Deckers Outdoor (NYSE:DECK) had its price target boosted by investment analysts at Jefferies Financial Group from $175.00 to $200.00 in a report issued on Friday, BenzingaRatingsTable reports. The brokerage currently has a "buy" rating on the textile maker's stock. Jefferies Financial Group's price objective would suggest a potential upside of 9.40% from the stock's current price. Jefferies Financial Group also issued estimates for Deckers Outdoor's Q4 2020 earnings at $0.27 EPS, FY2020 earnings at $9.32 EPS, Q1 2021 earnings at ($1.83) EPS, FY2021 earnings at $6.85 EPS and FY2022 earnings at $9.73 EPS.
Other equities research analysts have also recently issued reports about the stock. Robert W. Baird upped their price objective on shares of Deckers Outdoor from $205.00 to $216.00 and gave the stock an "outperform" rating in a report on Friday, January 31st. Susquehanna Bancshares upped their price objective on shares of Deckers Outdoor from $175.00 to $200.00 in a report on Friday. Citigroup decreased their price objective on shares of Deckers Outdoor from $180.00 to $175.00 and set a "buy" rating for the company in a report on Monday, April 20th. Evercore ISI reissued a "hold" rating and set a $175.00 target price on shares of Deckers Outdoor in a research report on Friday, January 31st. Finally, Cfra boosted their target price on shares of Deckers Outdoor from $190.00 to $210.00 and gave the stock a "buy" rating in a research report on Friday, January 31st. Four equities research analysts have rated the stock with a hold rating and thirteen have issued a buy rating to the stock. The stock presently has a consensus rating of "Buy" and a consensus target price of $188.63.
Read the full article here
Deckers Outdoor (NYSE:DECK) had its price target boosted by investment analysts at Jefferies Financial Group from $175.00 to $200.00 in a report issued on Friday, BenzingaRatingsTable reports. The brokerage currently has a "buy" rating on the textile maker's stock. Jefferies Financial Group's price objective would suggest a potential upside of 9.40% from the stock's current price. Jefferies Financial Group also issued estimates for Deckers Outdoor's Q4 2020 earnings at $0.27 EPS, FY2020 earnings at $9.32 EPS, Q1 2021 earnings at ($1.83) EPS, FY2021 earnings at $6.85 EPS and FY2022 earnings at $9.73 EPS.
Other equities research analysts have also recently issued reports about the stock. Robert W. Baird upped their price objective on shares of Deckers Outdoor from $205.00 to $216.00 and gave the stock an "outperform" rating in a report on Friday, January 31st. Susquehanna Bancshares upped their price objective on shares of Deckers Outdoor from $175.00 to $200.00 in a report on Friday. Citigroup decreased their price objective on shares of Deckers Outdoor from $180.00 to $175.00 and set a "buy" rating for the company in a report on Monday, April 20th. Evercore ISI reissued a "hold" rating and set a $175.00 target price on shares of Deckers Outdoor in a research report on Friday, January 31st. Finally, Cfra boosted their target price on shares of Deckers Outdoor from $190.00 to $210.00 and gave the stock a "buy" rating in a research report on Friday, January 31st. Four equities research analysts have rated the stock with a hold rating and thirteen have issued a buy rating to the stock. The stock presently has a consensus rating of "Buy" and a consensus target price of $188.63.
Read the full article here
Deckers Brands (NYSE: DECK) latest stock valuation
So what is Deckers Brands stock worth based on the release of their latest earnings report and the fiscal guidance provided for Deckers Brands 2020 fiscal year? Based on Deckers Brands latest earnings and their fiscal guidance provided our valuation model provides a target price (full value price) at $154.90 per Deckers Brands stock (up slightly from our 3rd quarter 2020 earnings report valuation) . We therefore believe that the stock of Deckers Brands is overvalued.
We usually suggest long term fundamental or value investors look to enter into a stock at least 10% below our target (full value) price which in this case is $154.90. Therefore we see a good entry point into Deckers Brands stock at $139.40 or below.
We expect the stock of Deckers Brands to pull back from current levels in coming weeks and months to levels closer to our target price (full value price).
We usually suggest long term fundamental or value investors look to enter into a stock at least 10% below our target (full value) price which in this case is $154.90. Therefore we see a good entry point into Deckers Brands stock at $139.40 or below.
We expect the stock of Deckers Brands to pull back from current levels in coming weeks and months to levels closer to our target price (full value price).
Next earnings release of Deckers Brands
It is expected that Deckers Brands will release their 1st quarter 2021 earnings report in late August 2020