Deckers Outdoor shares jumped as much as 17% on Friday, after multiple brokerages raised their price targets following the company’s bet on full-price sales of its hot-selling Hoka running shoes and UGG boots to raise its annual profit forecast.
Deckers shares rose as high as $961 a share – but gave up some of those gains before closing up 6.5%, at $894.70.
Rivals On Holding – backed by tennis star Roger Federer – and Nike also saw a boost in shares. On Holding shares were up 6.2% and Nike shares were up 1.7%.
Shoe manufacturers have seen a boost in running shoe sales, though Oregon-based Nike has struggled to keep with its competitors’ innovation.
Hoka and On have grabbed customers with new running shoe designs that offer extra “cloud-like” cushions.
Hoka has even developed a following of returning customers who want to buy running shoes in the latest colors – like Apple fanatics who line up for the latest iPhone.
And Deckers’ UGG boots have come back in style. Though the fuzzy winter boots first peaked in the early 2000s, they again spiked in popularity in 2022 and 2023 as comfortability became a priority for post-pandemic shoppers.
Wedbush analyst Tom Nikic wrote in a note that there has been less discounting from the UGG brand and the brand seems to be expanding its share in the sandal market, as well.
“Even in a choppier macro environment people are spending money on things they care about and these two are products that people care about,” Truist Securities analyst Joseph Civello said.
Truist Securities increased the 51-year-old clothing company’s price target to $1,225 from $1,200 – the highest on Wall Street.
Meanwhile, retailers like Dicks Sporting Goods and Nordstrom have been fanning the flames, giving more shelf space to Hoka and UGG shoes while cutting back on Nike.
Deckers reported Hoka sales jumped nearly 30% in the first quarter and UGG sales increased 14%.
Deckers now expects annual earnings per share in the range of $29.75 to $30.65, as compared to its previous forecast of $29.50 to $30.00.
With Post wires
