Back to top

Image: Bigstock

Here's Why Deckers (DECK) is a Hot Investment Pick for 2019

Read MoreHide Full Article

The U.S.-China trade war, government shutdown worries, tightening of monetary policy and adverse currency fluctuations acted as dampeners for investors in this year. In such a scenario, you may be looking for promising bets. Here, we are presenting one such stock — Deckers Outdoor Corporation DECK — which is most likely to sustain its momentum in 2019 as well.

Deckers share price movement reveals that it has surged roughly 49% so far this year. This Zacks Rank #1 (Strong Buy) stock not only outperformed the industry’s growth of 3% but also surpassed the Zacks Consumer Discretionary sector that fell 17.6%.

The company has been focusing on expanding brand assortments, introducing more innovative line of products, and targeting consumers digitally through marketing and sturdy e-commerce along with optimizing omni-channel distribution. In the trailing four quarters, it delivered average positive earnings surprise of 69.1%. Further, the company has a long-term earnings growth rate of 11.3%, which reflects its inherent strength.

Deckers made substantial investments to strengthen online presence and open smaller concept omni-channel outlets in a bid to keep up with the changing trends. This apart, the company’s focus on expanding programs — including Retail Inventory Online; Infinite UGG; Buy Online, Return In Store; and Click and Collect to enhance customers’ shopping experience — is encouraging. The company is also making additions to its portfolio as well.

Certainly, the company is on track with its endeavors to drive long-term growth. Its store-fleet optimization plan emphasizes striking the right balance between digital and physical stores. These actions are likely to boost profitability and shareholder returns as well as enhance brand and store performances. Clearly, Deckers is likely to continue with its stellar show in the upcoming quarters, which is quite evident from management’s encouraging outlook.

For fiscal 2019, management anticipates net sales of $1,935-$1,960 million, up from $1,930-$1,955 million mentioned previously. Adjusted earnings are projected to be $6.65-$6.85 per share, which portray an improvement from $5.74 reported in fiscal 2018. The company earlier forecasted adjusted earnings of $6.25-$6.45 per share. Further, gross margin for the fiscal year is anticipated to be about 50%, with operating margin of 13-13.2%.

Clearly, you can see from the above-mentioned factors that there are plenty of reasons to be optimistic about the stock going into 2019.

Here are 3 More Trending Stocks

Fossil Group, Inc. (FOSL - Free Report) outperformed the Zacks Consensus Estimate by a wide margin in the trailing four quarters. It currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Shoe Carnival, Inc. SCVL delivered average positive earnings surprise of 31.4% in the trailing four quarters. It currently flaunts a Zacks Rank #1.

Canada Goose Holdings Inc. GOOS delivered average positive earnings surprise of 83.2% in the trailing four quarters. It has a long-term earnings growth rate of 31.3% and a Zacks Rank #2 (Buy).

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Fossil Group, Inc. (FOSL) - free report >>