Why Deckers (DECK) Shares Are Trading Lower Today

What Happened?

Shares of footwear and apparel conglomerate Deckers (NYSE:DECK) fell 3% in the morning session after the stock's negative momentum continued as it was removed from Needham's Conviction List due to signs of slowing growth in its key brands, UGG and Hoka. 

The research firm cited "fundamental cracks" that emerged, noting UGG had posted three consecutive year-over-year declines in direct-to-consumer sales. At the same time, the Hoka brand recorded single-digit growth in the same channel for the first time since it was acquired. Needham stated its belief that both brands had entered a slower-growth stage. This development followed a period where the company's valuation was being reassessed, with concerns about new trade tariffs and brand maturation also weighing on the stock.

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What Is The Market Telling Us

Deckers’s shares are somewhat volatile and have had 12 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 8 months ago when the stock dropped 19.9% on the news that the company reported weak first quarter 2025 results: both revenue and EPS guidance for the next quarter missed. 

The miss was largely due to macro uncertainty tied to global trade policies and softer-than-expected domestic demand, with management calling out the lack of visibility and stepping away from providing full-year guidance altogether. Still, the just-ended fourth quarter told a brighter story. Constant currency revenue rose 7.5%, led by a 10% jump in HOKA sales and a 3.6% gain in UGG, while EPS beat expectations handily. This strength was fueled by solid international growth and stable margins. Zooming out, we think this was a mixed quarter, and the weak guidance likely weighed on shares. Following the mixed performance, Evercore downgraded the stock from Buy to Neutral, adding, "Once a well-loved story with strong growth momentum and margin expansion, we think DECK might be entering a new phase of lower growth profile as we see signs of deceleration across its two key brand growth engines – UGG and HOKA.".

Deckers is down 2.5% since the beginning of the year, and at $104.09 per share, it is trading 53.3% below its 52-week high of $223.11 from January 2025. Investors who bought $1,000 worth of Deckers’s shares 5 years ago would now be looking at an investment worth $1,910.

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