Decker’s Outdoor stock could gain further momentum as the footwear retailer continues to diversify its offerings, particularly across its Hoka brand, Jefferies said. The investment firm upgraded the stock from hold to buy. He also raised his price target to $130 from $110, implying a 23% upside from Friday’s closing price. “We see upside (opportunity) over 12 years (and months) depending on the success of HOKA’s product innovations. Early signs are encouraging,” analyst Blake Anderson said in a note Monday. “We particularly like HOKA’s performance and lifestyle segmentation, which allows us to leverage what we learned from UGG.” Decker’s Outdoor stock has risen 4% over the past year, well below the S&P 500 index, which has risen 21% during that time. Slow innovation and weak sales in the Hoka product line, the company’s everyday footwear brand, contributed to the company’s modest profits. However, the company has taken steps to diversify Hoka’s offerings. They recently introduced the Clifton Pro, a sneaker model that is more geared toward serious runners than the original design. DECK 1Y Mountain Deckers Outdoor’s share price is up 4% in the last 12 months. “We are particularly optimistic that the company’s enhanced segmentation efforts could be a key driver of its above-sales performance, albeit at an early stage with the launch of Clifton Pro reaching an important milestone last week,” Anderson wrote. The analyst added, “HOKA is an important discussion, but UGG should also be more durable than (market) expectations,” further increasing the value of the parent company’s stock. Jeffries’ call is consistent with Wall Street consensus. Of the 27 analysts covering Deckers Outdoor, 13 rate the stock as a buy or strong buy, according to LSEG data.
