Susquehanna Maintains a 'Positive' on Deckers Outdoor (DECK); Raises Price Target

October 19, 2009 11:10 AM EDT

Susquehanna maintains a 'Positive' rating on Deckers Outdoor (Nasdaq: DECK), raises price target to $100.

Susquehanna analyst says, "We are increasing our estimates and price target to $100 on DECK ahead of 3Q earnings on Thursday. While largely expected, we believe the company will beat expectations for the quarter given the early pull forward of UGG shipments to retailers and favorable consumer demand for boot product during the quarter. Several key retailers have noted boots as one of the strongest performing categories during September. We also contacted 15 Nordstrom (NYSE: JWN) stores this past week in addition to several Journeys and Lord and Taylor stores. Feedback was strong relative to expectations with several contacts reporting no fall-off in demand and no trade off to competing boot brands and styles. Given the low expectations for the brand in 4Q (flattish) and no indications of any cancelations, we believe there could be opportunity for the company to outperform in 4Q. With that said, guidance from management is always a stumbling block for the stock despite outperformance. However, we believe that after lowering the bar for 4Q after 2Q earnings, the chances of a further reduction is unlikely in our view (could raise the year by 3Q beat and sustain 4Q). Looking to FY10, we believe the assumption of distribution rights in key European markets will be the next catalyst for growth in sales and margins."

To see more analyst ratings on DECK Click Here.

Deckers Outdoor Corporation engages in the design, production, and brand management of footwear for outdoor activities and casual lifestyle use.

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