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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Deckers Outdoor Corporation (XNYS:DECK) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
DECK
Name:
DECKERS OUTDOOR CORPORATION (XNYS:DECK)
Sector:
- 51847.00K
Industry:
Footwear & Accessories
CEO:
Mr. David Powers
Total Employees:
4,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -50.90% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF DECKERS OUTDOOR CORPORATION(DECK) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND FOOTWEAR & ACCESSORIES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
317.32
One Month Price Target:
$318.91
Six Month Price Target :
$326.86
Likely Price in One Year's Time:
Ticker:
$336.41
Likely Trading Range Today Under (Normal Volatility)
$316.11
Price Upper limit ($) :
$319.46
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$297.51
This week:
$273.02
This month :
$228.72
Other Primary facts
Market Cap:
8.61B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
26.53M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.36%
-17.67%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$409.15
$366.35
$225.49
$268.29
Medium risk (<10%) entry points
Buy Call
Sell Call
$352.42
Buy Put:
Sell Put:
$343.28
$282.11
$291.36
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
DECK
Sharpe Ratio:
4.45%
Comparison:
DECK, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 183.47% higher than the industry
& ratio is 95.10% higher than the market/S&P 500 average
Average Returns/Yield of
DECK
Daily returns:
0.15%
Weekly returns:
0.74%
Monthly returns:
2.94%
Yearly returns:
13.15%
Comparison of returns:
Average annual returns/yield (last 3 years) is 168.70% above industry average
Classification:
DECK, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.49
Statistical test of Returns:
DECK has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.11%
Weekly Volatility:
6.96%
Monthly Volatility:
13.92%
Yearly Volatility:
48.21%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.21%
Volatility in last five trading days has been -93.18% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.24%
Weekly VaR:
-13.96%
Monthly VaR:
-27.92%
How Much Can the price of
DECK
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-23%
Worst case (decline):
>85%
This translates to price declining to:
$244.34
This translates to price declining to:
$47.60
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
DECK is a 97.07% riskier investment compared to the market/S&P 500 & is 68.83% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 5.52% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
DECK
Beta in relation to market/S&P 500--0.90
Expected beta in 1 year's time:
0.603
Expected beta in 3 year's time:
0.852
Unlevered (debt free) Beta:
0.81
Beta in relation to Nasdaq (XNAS):
1.072
Beta in relation to all global stocks::
0.846
Beta Comparison & Analysis
Beta of competitors/peers::
1.63
Beta is -45.08% lower than peers
Average Industry Beta:
1.075
Beta is -16.69% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
28.28%
Sustainable growth rate is 13.57% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.261
Alpha is 886.99% above industry average alpha yield
Alpha is 1658% higher than market/& is unsustainably high
Analysis of Cost of Capital of
DECK
Equity cost of capital:
0.093
Equity cost of capital is -11.69% below industry mean WACC
Unlevered (without debt) cost of capital:
8.40%
Before-tax cost of debt:
1.21%
After-tax cost of debt:
0.96%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.96%
WACC is -0.41% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$118.74
Revenue growth rate per share of (3Y):
5.93
Annual revenue growth rate is 56.88% above the industry average
EPS:
$16.26
Expected Annual growth rate of EPS (3Y):
18.84%
Expected future EPS growth rate is 7.29% higher than the Footwear & Accessories industry
Free cash flow (FCF) per share:
$4.67
-
-
Debt per share
$7.00
EBITDA per share
$22.56
Valuation Analysis Today of
DECK
P/E Ratio:
19.53
P/E Ratio of Competitors/Peers:
10.58
P/E ratio is 84.56% higher than main peers & is -8.99% lower than the industry
Stock price/value with industry average P/E ratio: $348.86
DECK is -9.04% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
2.67
Price to sales ratio is 2.09% above the industry mean
P/B (Price to book value ratio):
5.93
Price to free cash flow: 67.99
-
Net income growth rate (3Y):
278.58%
Net income growth rate is 62.66% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
13.09%
Net debt to equity ratio:
-51.07%
Debt to assets ratio:
8.11%
Net debt to assets ratio:
-31.63%
Debt-to-asset ratio is -82.33% below industry average
Ability to repay debt:
Interest coverage ratio:
213.19
Interest coverage ratio is 61.22% more than industry average
Looking forward:
Debt growth rate:
178.83%
Annual debt growth is 507% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.625
Statistical significance of correlation:
DECK has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.632
Stock price is -1.11% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.632
Correlation of price movement with Nasdaq (^IXIC):
-0.024
Covariance of price movement with the market:
-0.043
Kurtosis
5.072
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.005
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
DECK
Gross Profit Margin Ratio:
204%
Operating Profit Margin Ratio:
17.93%
Operating profit margin is 48.08% higher than the industry
Net Profit Margin Ratio:
204%
Effective Tax Rate:
19.96%
Effective tax rate is 11.00% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
31.85%
Return on equity (ROE) is 7.20% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
19.72%
Return on assets (ROA) is 42.76% higher than the industry
Financial Leverage:
1.1x
Current Ratio:
2.87
Current ratio is 10.46% above industry average
Cash Conversion Cycle (days):
-47.5
Cash conversion cycle is -161.28% below industry average
The remaining useful life of property plant & equipment is: 1.7 years
Stock based compensation to net income ratio:
1.23%
In-depth Efficiency Analysis
Revenue generated per employee:
787.6K
Each employee generates -5% less revenue than industry average revenue per employee
EBITDA generated per employee:
149.7K
Each employee generates 21% more EBITDA than industry average revenue per employee
Profit generated per employee:
113.0K
Each employee generates 9% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 13.0K
Each employee generates 8% more free cash flow than industry average revenue per employee
Assets/Capital per employee
141.3K
Each employee generates 8% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
DECK
Capri Holdings Limited (XNYS:CPRI)
NORWEGIAN CRUISE LINE HOLDINGS LTD. (XNYS:NCLH)
AUTOLIV, INC. (XNYS:ALV)
LEVI STRAUSS & CO. (XNYS:LEVI)
DICK'S SPORTING GOODS, INC. (XNYS:DKS)
LITHIA MOTORS, INC. (XNYS:LAD)
QUANTUMSCAPE CORPORATION (XNYS:QS)
SEALED AIR CORPORATION (XNYS:SEE)
UNDER ARMOUR, INC. (XNYS:UAA)
Current Analyst Ratings
Strong buy�17%
Buy�4%
Hold�42%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
3.15B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.54B
1.61B
-
-
1.04B
-
-
1.04B
1.90M
2.81M
31.20M
598.65M
564.71M
451.95M
564.64M
112.69M
451.95M
Statement of Cash Flow
Date:
Period:
9.97M
Differed Income Tax :
- 4002.00K
Stock Based Compensation :
5.56M
Change in Working Capital :
- 93901.00K
Accounts Receivables:
- 633.00K
Other Working Capital:
6.65M
Other Non-Cash Items:
- 2082.00K
Net Cash Provided by Operating Activities:
- 36332.00K
Investments in PP&E:
- 15515.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
6/30/21
2022
Q1
956.71M
-
956.71M
222.65M
457.70M
89.14M
1.73B
412.22M
13.99M
41.38M
-
40.82M
56.65M
565.06M
-
2.29B
393.64M
46.28M
46.42M
-
160.62M
600.53M
185.78M
85.96M
271.74M
-
872.27M
277.00K
1.22B
- 13392.0K
208.76M
June 30, 2021 at 6:00:00 AM
2.59B
1.42B
2.29B
-
232.06M
- 724656.0K
-
-
- 15515.00K
-
-
- 82251.00K
-
69.00K
- 82182.00K
1.38M
- 132649.00K
956.71M
1.09B
- 36332.00K
- 15515.00K
- 51847.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
DECK
2023
2024
2025
2026
2027
$355.69
$377.08
$399.77
$423.82
$449.31