Deckers Brands (DECK)
NYSEConsumer DiscretionaryApparel - Footwear & AccessoriesSnapshot 2026-09-04
$85.81+1.55%
Close 2026-09-04 · 1-day change
NYSEConsumer DiscretionaryApparel - Footwear & AccessoriesSnapshot 2026-09-04
Broken: Primary pillar broken — Maintain gross margin at approximately 57%: 56.4% vs 57% target.
Deckers grows revenue about 9% a year. Profit margins stay near 57% gross and 22.5% operating. The company beats earnings estimates consistently. Free cash flow yield is solid at 7%.
Revenue growth could slow below high-single digits. Margins might compress from cost pressures. The sector faces headwinds that could hurt demand.
The price is about 25% below our fair value near $143. Analysts expect about 9% revenue growth, which aligns with management's high-single-digit target. Our fair value is 18% above the Street median.
Breaks if: gross margin falls below 54% (mid-cycle floor)
Sustain gross margin levels around 56.5% to 57% to support profitability and operational efficiency.
Stated in 4 of last 4 quarters. Gross margin was 57.7% in FY 2026 and guidance for FY 2027 is slightly better than 56.5%. Management has consistently targeted this range, and the actual margins have been stable, indicating delivery on this priority.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a medium confidence level. The company is working towards consistent revenue growth and margin stability, but faces headwinds from the broader consumer discretionary sector.
The market currently prices DECK as cheap compared to its peers, reflecting a low expectations gap. However, there is a fragility in execution quality that suggests the stock may not fully reflect potential risks.
Management aims for high-single-digit revenue growth and stable gross margins, which they have consistently communicated. Recent financial performance has been neutral, and while the risk of missing expectations is low, the company has a history of significant misses.
The long-term thesis hinges on management's ability to meet growth targets and maintain margins. Additionally, external factors such as inflation trends and performance of sector peers will play a crucial role in shaping future outcomes.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports a goal of high-single-digit revenue growth in FY 2027. There are no new threats impacting the thesis.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
“Gross margin is now expected to be slightly better than 56.5%.”
“Gross margin is expected to be approximately 56.5%.”
“Gross margin is now expected to be approximately 57%.”
“Gross margin is expected to be approximately 56%.”
Breaks if: operating margin falls below 20% (mid-cycle floor)
Maintain operating margin near 21.5% to ensure strong profitability and operational discipline.
Stated in 4 of last 4 quarters. Operating margin was approximately 23.1% in FY 2026 and guidance for FY 2027 is slightly better than 21.5%. Management has consistently emphasized this target, and the operating margin remains strong, showing delivery on this priority.
“Operating margin is now expected to be slightly better than 21.5%.”
“Operating margin is expected to be approximately 21.5%.”
“Operating margin is now expected to be approximately 22.5%.”
“Operating margin is expected to be approximately 21.5%.”
Breaks if: YoY revenue growth falls below ~8.8% in FY 2027
Overall, DECK's performance will depend on effective execution and external market conditions over the next few years. Not investment advice.