Deckers' Expanding DTC Business Supports a Favorable Sales Mix

Deckers Outdoor Corporation DECK direct-to-consumer (DTC) business emerged as a key growth driver in the first quarter of fiscal 2027. DTC net sales increased 13% year over year to $352.8 million, outpacing 2.2% wholesale growth. Comparable DTC sales rose 6.8% on a constant-currency basis, underscoring healthy demand across established operations.

HOKA was the primary contributor to DTC momentum, with channel revenues increasing 17.3% to $256.8 million. International regions delivered robust growth, while the United States maintained positive momentum. Demand extended beyond Clifton and Bondi, with Speedgoat 7, Mach 7, Mafate Speed 2 and Skyward products collectively contributing more than half of global HOKA DTC growth.

UGG supported channel expansion, with DTC revenues rising 5.7% to $83.8 million. Its mono-brand retail presence was particularly effective in Asia, encouraging consumer adoption across new categories. Investments in fashion casual footwear, sneakers and sandals, alongside year-round and men’s initiatives, are broadening the brand’s appeal and deepening consumer engagement.

Deckers’ DTC strength supported gross margin expansion through a favorable channel mix. Gross margin increased 60 basis points to 56.4%, reflecting faster DTC growth, favorable product mix, full-price selling, currency benefits and improved closeout management, partially offset by incremental tariffs. Product innovation and targeted marketing investments are helping sustain demand across both flagship brands.

Management expects significant DTC growth to continue in fiscal 2027. Consolidated revenues are projected at $5.86-$5.91 billion, with total HOKA revenues growing at a low-double-digit rate and UGG revenues at a mid-single-digit rate. Broader product adoption and international momentum position DTC as an important contributor to Deckers’ growth and premium brand development. We expect total DTC sales to increase 9.3% in fiscal 2027.

DECK’s Price Performance, Valuation & Estimates

Shares of Deckers have lost 23.1% over the past three months compared with the industry’s 10.2% decline.

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From a valuation standpoint, DECK trades at a trailing price-to-sales ratio of 2.10, up from the industry’s average of 1.34. It has a Value Score of A.

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The Zacks Consensus Estimate for Deckers’ fiscal 2027 earnings implies year-over-year growth of 6.8%, whereas the same for fiscal 2028 indicates an uptick of 10.9%. The estimates for fiscal 2027 and 2028 have been unchanged and revised upward by 1 cent, respectively, over the past 30 days.

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DECK currently carries a Zacks Rank #3 (Hold).

Key Picks

FIGS, Inc. FIGS is an apparel company focused on the healthcare industry. Its offerings include lab coats, jackets, footwear, bags, socks and other accessories used by healthcare professionals. The company carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for FIGS’ current financial-year earnings and sales suggests growth of 89.5% and 18.2%, respectively, from the year-ago actuals. FIGS delivered a trailing four-quarter average earnings surprise of 201.8%.

Boot Barn Holdings, Inc. BOOT is the largest lifestyle retailer in the United States, specializing in western and work-related footwear, apparel and accessories. The company also holds a Zacks Rank #2 at present. 

The Zacks Consensus Estimate for Boot Barn’s current fiscal-year earnings and sales suggests growth of 22.6% and 15.7%, respectively, from the year-ago actuals. BOOT delivered a trailing four-quarter average earnings surprise of 11.4%.

Urban Outfitters, Inc. URBN is a lifestyle products and services company that sells fashion apparel, accessories, footwear, home goods and related offerings through a portfolio of global consumer brands. The company carries a Zacks Rank #2 at present. 

The Zacks Consensus Estimate for Urban Outfitters’ current fiscal-year earnings and sales suggests growth of 13.1% and 9.1%, respectively, from the year-ago actuals. URBN delivered a trailing four-quarter average earnings surprise of 9.7%.

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