UGG And HOKA Parent Deckers Stock Is Falling Friday: What's Going On?

UGG and HOKA parent Deckers Outdoor Corporation DECK shares are trading lower Friday. The company reported fourth-quarter earnings after the close Thursday and issued weak guidance for the first quarter, while opting not to issue full-year guidance.

What To Know: The company reported earnings per share of $1.00, beating the consensus estimate of 59 cents. In addition, the company reported sales of $1.02 billion, beating the consensus estimate of $1.01 billion and representing a 7.5% growth year-over-year.

The company broke down sales further, reporting UGG brand sales increased 3.6% year-over-year to $374.3 million. HOKA brand sales increased 10% to $586.1 million and other brand net sales decreased 6.3% to $61.3 million.

Stefano Caroti, President and CEO, said, “While the global trade environment has introduced greater near-term uncertainty, we are very confident in the exciting opportunities ahead for HOKA and UGG. We view these brands as industry leaders, each with iconic and innovative products that operate in differentiated marketplaces. Alongside Deckers’ superb balance sheet, this positions us well to manage through the near-term with a focus on the long-term.”

Cynthia Davis has been named chair of the board, stepping in for Michael Devine, who is retiring after 14 years of service.

Outlook: The company sees first-quarter earnings per share from 62 cents to 67 cents, versus the consensus estimate of 81 cents. Furthermore, it sees sales from $890 million to $910 million, versus the consensus estimate of $925.86 million.

Deckers held back on issuing fiscal-year guidance due to macroeconomic uncertainty.

Analyst Changes: Following the earnings report, multiple analysts issued price target adjustments.

• Needham analyst Tom Nikic maintained a Buy rating on Deckers and lowered the price target from $150 to $120.
• Telsey Advisory Group analyst Dana Telsey downgraded Deckers from an Outperform rating to a Market Perform rating and lowered the price target from $240 to $120.

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DECK Price Action: At the time of publication, Deckers stock is trading 19.6% lower at $101.41, according to data from Benzinga Pro.

Image: via Shutterstock