Jefferies has adjusted its valuation and model for Deckers Outdoor, raising the company's price target to $105 from $102 while keeping a Hold rating on the stock. The change accompanies upward revisions to near-term earnings and revenue forecasts, driven primarily by the HOKA brand's better-than-anticipated direct-to-consumer performance.
The broker increased its fiscal third-quarter earnings per share estimate to $2.83, above the Street consensus of $2.77. Jefferies attributed the bump to stronger direct-to-consumer sales at HOKA.
On a brand-by-brand basis, Jefferies forecasts HOKA direct-to-consumer sales will expand 11% year-over-year, outpacing consensus expectations of 8%. By contrast, UGG sales are projected to decline 5% year-over-year, a slightly larger drop than the consensus estimate of a 4% decrease.
Looking further ahead to fiscal 2026, Jefferies models 14% revenue growth for HOKA, versus the Street's 13% projection and management's guidance of mid-teens growth. For UGG, Jefferies' estimates remain at 5% growth, which the firm notes aligns with both consensus forecasts and management's characterization of low-to-mid-single-digit growth.
Jefferies also raised expectations for the upcoming quarter, flagging it as an important test of Deckers' ability to offset tariff pressures through pricing. The firm pointed to anticipated sequential improvement in HOKA sales and easier year-ago comparisons in the fourth quarter as potential tailwinds. Deckers is scheduled to report fiscal third-quarter results on January 29.
Valuation metrics referenced alongside the updated forecasts show the company trading at a price-to-earnings ratio of 15.07, which the analysis indicates is low relative to near-term earnings growth and suggests the stock may be undervalued compared to its fair value estimate. The company also retains a "GREAT" overall financial health score.
Brokerage sentiment beyond Jefferies is mixed. Stifel continues to carry a Buy rating and anticipates Deckers will beat revenue and adjusted EPS expectations, potentially prompting an upward revision to full-year 2026 guidance. In contrast, Bernstein has reiterated an Underperform rating, noting a pronounced year-over-year decline in the share price despite a recent recovery.
Other firms have expressed varied concerns. Piper Sandler keeps an Underweight stance, pointing to questions over the HOKA brand's long-term trajectory in the U.S. market. Baird downgraded Deckers from Outperform to Neutral, citing a deceleration in growth expectations for HOKA. Needham removed the stock from its Conviction List while maintaining a Buy rating, flagging what it describes as "fundamental cracks" emerging since 2025.
The combination of upgraded near-term assumptions from Jefferies and divergent views among other research teams leaves investors facing a range of scenarios heading into the January 29 earnings release. The coming quarter will be closely watched for evidence that pricing and unit trends can blunt tariff headwinds and support the growth trajectory for HOKA while stabilizing results for UGG.