Citi analysts raised the price target for Deckers Brands (NYSE:DECK) to $665 from $515 in a note Friday, maintaining a Buy rating on the stock.
The analysts told investors in their earnings preview note that they expect DECK to report a "big 1Q beat and guidance raise." The company will report earnings after the close on July 27.
"Our 1Q24E of $2.59 is well above cons $2.13 and we believe the market expects closer to us. We expect a beat from better sales in Hoka DTC and slightly stronger GM. We expect mgmt to raise F24 sales guidance (from 9% currently to +LDD) and EPS by the amount of the beat," they wrote.
"Even with an expected raise, we believe guidance will still look conservative. Our F24E of $23.01 is well above cons $21.97 based on stronger Hoka sales/GM. If 1Q GM is in-line with our est, it suggests a higher GM this year vs current guidance of 52.0%."
Citi acknowledges that positioning is "somewhat scary" ahead of the release with high expectations. However, they believe 1Q EPS are likely to "further crystalize the global growth opportunity still ahead for Hoka," which the firm says will be a net positive.