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Deckers Outdoor Corp. Message Board

  • johndoolittle46 johndoolittle46 May 31, 2013 11:13 AM Flag

    why dividend stocks are selling off and companies like Deckers are going up

    Interest rates are up 40% in the last months(yes, you read that correctly) so the risk in dividend stocks is now much higher as interest rates(the 10 year and the 30 year) now give a better return than most companies giving dividends, thereby making it more risky as opposed to risk free government bonds. Hence, the sell-off.

    Interest rates going higher makes investing in any stock more risky but when you have a company like Deckers trading at its uny valuation relative to its earnings and cash production, the risk is much more minimal compared to other stocks. Which is why you see dividend stocks going down as those in them get out and either look to put their money in the risk free government bond as they are incentivized to and those who are more aggressive notice the cash machine that is deckers and plow their money in here.

    Interest rates rising is not a totally bad thing for us as we are still so undervalued just for PRESENT day earnings and cash production. Money coming here.


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