Deckers Outdoor (DECK) Bullish Stance Reiterated at Sterne Agee, Estimates Cut on FX

Sterne Agee analyst Sam Poser reiterated a Buy rating and $110 price target on Deckers Outdoor (NASDAQ: DECK) saying the UGG business is sound, although estimates were cut on FX.

Poser commented, "The UGG business is healthy. The UGG business, and the way it is run by UGG management, are evolving. New foul weather and fashion styles are becoming materially more important, and the Classic business is maturing, though updates such as leather Classics performed very well. Given generally un-seasonally warm weather in December, UGG sales for the quarter were better than most retailers would have anticipated. Despite a deceleration in December the wholesale purchases in 3Q15 were up year over year as retailers' inventory positions were lower going into the quarter than they were going into 3Q14. Those retailers that bought into the cold weather waterproof and fashion products properly, and did not front load Classics had healthy sales."

FX pressure causes us to modestly lower estimates:

• 3Q15 EPS is being lowered from $4.83 to $4.77
• 4Q15 EPS is being lowered from $0.15 to $0.13
• 1Q16 EPS is being lowered from ($1.09) to ($1.11)
• 2Q16 EPS is being lowered from $1.31 to $1.29

For an analyst ratings summary and ratings history on Deckers Outdoor click here. For more ratings news on Deckers Outdoor click here.

Shares of Deckers Outdoor closed at $79.80 yesterday.

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