Thank you for this post. This means huge sales for UGG, but it is also slightly worrisome that Deckers is willing to have UGGs sold at a discount.
I wish more people would post news of this kind (also illustrated by the post about the UGG store in Hawaii). We need information about sales, not mere opinions about the value of the DECK shares and criticisms of those who don't believe the shares are undervalued.
I would agree that this is a bit questionable with long-term growth. Getting into bed with WMT in any way is very dangerous to margins and pricing...just ask KO or PEP, or even Vlasic Pickles. I am also a little surprised they went with SAMS and not Costco. The demographics of Costco make more sense with middle to mid-upper class at Costco. The argument might be that now SAMS shoppers can also buy a product they would normally not see (i.e. sticking with "accessible luxurious comfort), but the general lower-middle to middle class at SAMS may balk at the price and thus leave DECK with returns of unsold products. I would not be surprised to see adult UGGS only as kids shoes @ ~$100 for that crowd will likely see limited sales.
From an elementary business perspective, this looks attractive, but from the DECK strategy I have to wonder if this is the most effective ways and means to reach the desired end-state. But then again, this is a company that runs business as "unusual" and thinks it will turn a niche into a global lifestyle brand.
VERYPURE, if you read the article, it talks about Sam's club selling boots that are less than 200. The classic retails for 155, the mini's retail for 135, kids boots retail for 100 or so, etc.
It is not a bad thing, it is another distributor of our product = really good. Deckers won;t lose money on the deal or they wouldn;t do it. They are just going after the masses, which as investors is what we want. We want more people wearing our product. WE WANT INCREASE IN REVENUES aka growth.
Oh man, would that not be a shot at me verypure lol. Too bad I'm not concerned about sales, as I have shown, the sales take care of themselves.
I am concerned about the stock price because that is how I make my money. I'm invested long term, but trade around valuations.
So to me, it is very important to use the 10 year discount rate and the coming earnings to predict where Deckers will stall out, such as knowing about a week ago that at 68(sam posers target) we hit a short term wall going into October earnings and were pricing in most of the october earnings, and if there was a big miss, the investor wasn;t going to be paid for it, hence sell-off to price in the miss, and now one is getting paid for a miss.
So while some people have made nothing with the stock around 60 for the last half a year, I'm up more than 15% ;). But thanks for caring