Deckers Outdoor Corporation DECK has witnessed a significant decline over the past six months, with its shares plummeting 49%, underperforming the Zacks Retail-Apparel and Shoes industry's drop of 15.7%. The company also trailed the Retail-Wholesale sector’s fall of 3.4% and the S&P 500's decline of 1.5% during the same period.

Deckers’ Past Six-Month Performance

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The recent decline in the DECK stock’s price is primarily led by slowing growth and heightened competition across the footwear and accessories space. In addition, softness in U.S. consumer spending and promotional activity around model transitions led to weaker-than-expected direct-to-consumer (DTC) sales in HOKA’s key U.S. market, which may have raised investor concerns about growth momentum.

The Deckers stock has also underperformed its peers, including Boot Barn Holdings, Inc. BOOT, Adidas ADDYY and NIKE Inc. NKE.

Shares of Boot Barn have risen by 9.6%, while those of Adidas and Nike have declined by 7.3% and 18.7%, respectively, over the same period.

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Closing at $107.70 in yesterday’s trading session, the DECK stock stands almost 51.9% below its 52-week high of $223.98 attained on Jan. 30, 2025. Deckers is trading below its 50 and 200-day simple moving averages of $112.56 and $154.26, respectively, signaling bearish sentiment in maintaining the recent performance levels.

DECK Trades Below 50 & 200-Day Moving Averages

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Despite the downside, Deckers is currently trading at a forward 12-month P/S ratio of 2.96, which significantly exceeds the industry average of 1.74 and the sector average of 1.61. Deckers’ elevated valuation raises concerns, especially given its current challenges. This premium may be difficult to justify if the company faces any further slowdown or margin pressure, potentially limiting future upside.

This premium positioning is especially notable when compared with peers like Boot Barn (with a forward 12-month P/S of 2.27), Nike (2.05) and Adidas (1.41).

DECK Looks Expensive From Valuation Standpoint

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What’s Behind DECK’s Dismal Stock Run?

Deckers Outdoor Corporation, despite reporting a record-setting fiscal 2025, is facing increasing investor skepticism, and recent market performance reflects it. The company’s brands — HOKA and UGG — have delivered consistent growth, but several near-term headwinds are casting a shadow over its outlook and weighing on investor sentiment.

One of the most pressing concerns is the mounting uncertainty related to tariffs. A major concern heading into fiscal 2026 is the expected impact of newly announced tariffs. Management disclosed that Deckers could face up to $150 million in additional cost of goods sold as a direct result of these trade policy changes. While the company has plans to partially offset these costs through selective pricing actions and cost-sharing with suppliers, management made it clear that a portion of the burden will be absorbed internally. This will weigh on the company’s gross margin, which reached a record 57.9% in fiscal 2025 but is expected to decline in fiscal 2026. 

Another issue is the soft performance of HOKA’s direct-to-consumer business in the United States, which came under pressure during the fiscal fourth quarter. The company attributed this to various temporary factors, including model transitions and increased promotional activity. However, the weakness also reflects broader caution among U.S. consumers, especially in a climate of economic uncertainty. Deckers emphasized that international DTC trends remained strong, but the U.S. softness raises questions about the sustainability of domestic growth.

As a result of these challenges, Deckers opted not to issue formal revenue or earnings guidance for fiscal 2026. Management cited the unpredictability of global trade policies and volatile consumer sentiment as core reasons behind this conservative approach. Even the limited guidance provided for the fiscal first quarter suggests a cautious outlook. 

Gross margin is projected to decline by 250 basis points year over year, pressured by higher freight expenses, aggressive promotional activity, and a less favorable sales mix tilted toward wholesale. Meanwhile, SG&A costs are expected to outpace revenue growth due to ongoing investments in brand-building. Earnings per share are expected between 62 cents and 67 cents compared with 75 cents in the prior-year period, adjusted for the stock split. This is an early sign of tightening profitability as the company enters a more complex environment.