The shorts actually see weak retail results and figure DECK will follow with a similar outcome. LULU and ULTA both defined a women's sector with extremely weak guidance. They see everything in this sector tanking post earnings. Why should they think differently about DECK in a rational thought pattern? This is why you continue to have the interest remain high awaiting a fall.
The CEO of Macys actually was on last night and said that women's shoes and boots were one of the best selling areas followed by beauty products. He also said that the colder weather was driving sales.
Advisorydoc: I think DECK acquired full ownership of Hoka less than one year ago. You are a bit unrealistic to expect the brand to be up and running (as it were) at full speed in so little time. DECK has nothing short of fantastic management, and I think you are even unfair to cast aspersions on its managers so early about the handling of this brand. But as you know, I fully agree that this brand will prove to be a highly lucrative acquisition. Doug Otto, the founder of Deckers, used to say that they were "always looking for the next UGG." I think with Hoka they have found another big winner.
My main worry is that Nike and other big running shoe companies will come out with their own version of the Hoka. I even theorize that DECK may be intentionally keeping Hoka a bit under the radar until they "own" this style of running shoe and are able to outcompete the copy cats (who are sure to come at some point).
I also believe that Teva has a lot of unrealized potential. The last president couldn't get the job done, and there is a new president now (as of about two months ago). The first president Angel hired (an Italian at the cutting edge in style) would probably have been great, but he was badly injured in a motorcycle accident right after being hired and could never take the reins. So the brand has really yet to be given a chance. As you must know, the brand just opened its first stand-alone store.
And of course Sanuk has serious potential as well.
Oh please, the shorts aren;t kidding anyone at this point. The stock is up 200% in 14 months while 10M shorts watched themselves lose more than 500M dollars(excluding any possible options protection that saved them some money).
But it is abundantly clear that the shorts bet wrong for reason that are quite obvious at this point and truly does not have much to do withy YOUR reasoning AdvisoryDOC....though you do raise some points about how management is going about marketing the other brands.
But at the end of the day, I invested in this company primarily for the UGG Brand and could at this moment really not care less about the others.
What the shorts were betting against was a company facing ever rising prices in sheepskin with seemingly no end ins sight(until it ended in 2012 and actually pulled back 11% for 2013 and is again continuing to pullback for 2014) as well as low interest rate environment and warmer weather and temporarily decline in revenue of 11%.
BUT....the shorts have been caught with their pants down a management got aggressive with a buyback to buy what will be 300M dollars worth or 15%+ of the company back at 3-5 year lows.
Interest rates have doubled over the last 14 months from 1.5% to 2.86% allowing companies like Deckers become hot again due to their cash flow.
Management has innovated with UGG PURE and this has taken the shorts main avenue of attack of ever rising costs off the table. Their thesis is gone and the worst case scenario is gone. The hit to the bottom line due to rising costs has receded.
Then there is the warmer weather issue....another non-issue as we are again having a cold winter for the second year in a row.
So....the value of Deckers for JUST the UGG BRAND needs to go back to all-time highs+ over time as this brand is now relevant for more than a decade and now growing international
The other brands for this company are just bonuses. But they are not important enough to care about for me personally.