Sterne Agee CRT Reiterates Buy Following Deckers Outdoor (DECK) FQ4 Results

Sterne Agee CRT reiterates a Buy rating and $90 price target on Deckers Outdoor (NASDAQ: DECK) following Q4. DECK reported EPS of $0.04 versus estimates of $0.00. Revenue increased 15.6% versus estimates of +9.9%. Analyst Sam Poser said that DECK's brands are showing strength.

Poser commented, "Deckers’s brands are showing strength and diversity across the board. UGG’s strength is well beyond Classics; Teva, Sanuk, Hoka, and Ahnu are all gaining traction. The weakness of the stock during the call was the result of investors' inability to reconcile a low single digit increase in the total company FX neutral backlog, and the guidance for an 8% increase in FY16 FX neutral revenue. While we understand the concern, we are confident that DECK management has more than adequate dry powder across its brand portfolio to handily beat guidance."

Poser also added, "FY16 guidance calls for revenue growth of 10.5% of a FX neutral basis and +8.0% on a reported basis: By brand on a reported basis, the company expects UGG to grow 5%-6% with domestic wholesale to grow 7%. DTC comps for UGG are expected to be up LSD, which assumes brick and mortar SSS down MSD, and e-commerce sales up high teens. Teva, Sanuk, and HOKA are expected to grow 9%, 11%, and 74%, respectively. Total Other brand sales, where HOKA is housed, will increase ~50% according to management as strength of HOKA and Ahnu are offset by the discontinuation of the Tsubo and Mozo brands. DECK is using EUR price of ~$1.09."

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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