Deckers (DECK) Q4 CY2024 Report: Revenue Surpasses Estimates, Stock Dips
Key Highlights
* Revenue: $1.83 billion, exceeding analyst estimates of $1.73 billion (17.1% YoY growth, 5.5% beat)
* GAAP EPS: $3, outperforming analyst consensus of $2.61 (14.9% beat)
* Raised full-year revenue guidance to $4.9 billion at the midpoint ($4.8 billion previously), a 2.1% increase
* Maintained operating margin at 31%, consistent with the prior year quarter
* Constant currency revenue rose 16.6% YoY (vs. 15.1% in Q4 CY2023)
Market Reaction
Despite strong Q4 results, Deckers' stock dropped 15.8% to $187.34 following the earnings release. Analysts attributed this decline to slightly lower-than-expected full-year revenue guidance.
Company Overview
Deckers, established in 1973, is a global footwear and apparel conglomerate with a portfolio of lifestyle and performance brands.
Growth Potential
Deckers has a solid track record of growth, with a 18% compounded annual growth rate in sales over the past five years. Constant currency revenue growth has averaged 17.7% annually over the last two years, indicating stable demand.
Financial Health
Deckers maintains a strong cash profitability, with a 13.2% free cash flow margin over the last two years, surpassing the consumer discretionary sector average.
Conclusion
While Deckers' Q4 results exceeded expectations in many areas, the market's reaction suggests that investors were anticipating even stronger performance due to the company's high forward P/E ratio (39x) prior to the release. Nonetheless, Deckers remains a quality stock with a strong growth trajectory and impressive financial health. Investors may consider conducting further analysis to determine the long-term value proposition.