Shares of Deckers Outdoor jumped 13% to breach the $1,000 mark for the first time on Friday, as the footwear company posted upbeat fourth-quarter results, riding on the popularity of Ugg boots and Hoka sneakers among Americans.
The company’s stock has been on a tear since the beginning of last year, and is up about 35% this year, after rising 67% in 2023. In contrast, Nike has dropped 15% this year.
“We anticipate sentiment stays bullish around the stock as the company shows it can maintain a high EPS growth rate,” UBS analyst Jay Sole said.
Upstart brands such as On Holdings and Deckers Outdoor have been able to sustain demand as wholesale retailers open their shelf spaces to their innovative products at a time when giants such as Nike and Adidas are taking a hit.
Hoka and Ugg have become two of the strongest and most in-demand brands in the footwear space, CEO David Powers said on a post-earnings call on Thursday.
Hoka’s net sales jumped 34% in the fourth quarter, contributing nearly 56% to Deckers’ revenue, while those of UGG were up 14.9%.
UGG accounted for nearly 38% of its overall sales.
Those strong sales figures prompted at least 14 analysts to raise their price targets on the stock.
“Success of the pull-model in UGG and building awareness of Hoka are likely to continue to drive growth,” Barclays analyst Adrienne Yih said.
“There remains ample opportunity to continue to build on relatively low awareness,” Yih noted.
The average rating of 22 analysts on the stock is “buy,” with a median price target of $1,039, according to LSEG data.
Wedbush analyst Tom Nikic said Deckers continues to be one of “the fundamentally strongest names” in the brokerage’s coverage.
Still, some analysts said Deckers was a bit conservative in giving its annual forecasts.
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