• Stifel raised its rating on DECK to 'Buy' from 'Hold,' while maintaining its price target of $117.
• The research firm said the stock has an attractive valuation and that the company has a strong balance sheet.
• Stocktwits sentiment for DECK remained 'bearish.'

Deckers Outdoor Corp.'s shares gained 3.8% on Tuesday, continuing gains in the after-market session, following a rating upgrade from Stifel. The stock closed in the green after three straight sessions of decline.

Attractive Valuation, HOKA Momentum

Stifel raised its rating on DECK to 'Buy' from 'Hold,' following its analysts' meeting with Deckers management. The research firm believes the stock offers an attractive valuation, trading at just 11.7 times fiscal 2027 earnings, well below the footwear peer average of 17 times price-to-earnings.

"We take a more positive view on risk/reward,” Stifel analysts said, also citing momentum for HOKA shoes and the company's balance sheet strength. They, however, maintained their earlier price target of $117, implying a nearly 40% upside from the stock's latest close.

"We think the days of 20%+ topline growth are in the rearview, but see potential for global share gains, distribution expansion, and broader category representation supporting low-double-digit topline growth for multiple years."

Retail and Analysts' View

The upgrade failed to lift the retail sentiment. On Stocktwits, the sentiment reading remained 'bearish' as of late Tuesday, unchanged over this week. Given the 'extremely low' message volume, it is likely that Stocktwits users haven't yet registered their latest view on the stock.

Deckers' shares are down by over 20% since it issued a downbeat annual forecast on Oct. 23.

Stifel said Deckers plans to broaden distribution for its HOKA line and raise prices across the UGG brand. It also highlighted the company's strong balance sheet, noting $2 billion in cash, no debt, and an ongoing $2.2 billion share-repurchase program.

Currently, 13 of the 26 analysts covering DECK have a 'Buy' or higher rating on the stock, 11 rate it 'Hold,' and 2 rate it 'Sell' or lower, according to Koyfin. Their average price target is $111.97, which projects 33.7% gains.

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