Why Deckers Stock Popped Today

Source The Motley Fool

Shares of Deckers (NYSE: DECK) were among several footwear stocks climbing today, seemingly in response to a blowout September jobs report, which reassured investors about the strength of the economy, as well as the end of the dockworkers' strike, as both sides came to an agreement until at least Jan. 15. Shoes were among the products expected to be affected by the strike, so it's not surprising to see footwear stocks, including Skechers and On Holdings, rising broadly on the news.

Deckers stock closed up 6.4%, even as there was no company-specific news out on the stock.

Person shopping for sneakers in a store.

Image source: Getty Images.

Consumers are getting stronger

According to the report from the Labor Department, the U.S. economy added 254,000 jobs last month, well above expectations of 150,000. The unemployment rate fell from 4.2% to 4.1%, and wages grew by 4%, easily outpacing existing inflation.

Altogether, the report showed the economy was getting stronger, which was especially good news for consumer spending. Additionally, the end of the port shutdown is clearly good news for Deckers and its peers, especially ahead of the holiday season.

Stocks rose on the news, in particular in the consumer discretionary sector. The SPDR Select Consumer Discretionary Sector was up 1.2%, outpacing the overall market.

Deckers isn't struggling by any means, as its high-priced Hoka running shoes have swept the nation, driving the stock to new records, but the business is still sensitive to overall economic demand and depends on the global supply chain.

In the second quarter, revenue jumped 22% to $825.3 million, and earnings per share nearly doubled. Hoka has become the unquestionable star of the business, with revenue up 30% to $545.2 million.

Can Deckers keep gaining?

Deckers is fresh off a 6-for-1 stock split, a sign of the company's excellent execution. At this point, the business seems virtually flawless, but consumer tastes can be fickle, as Deckers experienced before with the rise and fall of UGG.

For now, the stock looks like a winner, but keep your eye on the competitive landscape, especially as Nike is touting a recovery in its running business.

Should you invest $1,000 in Deckers Outdoor right now?

Before you buy stock in Deckers Outdoor, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Deckers Outdoor wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $752,838!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.

See the 10 stocks »

*Stock Advisor returns as of September 30, 2024

Jeremy Bowman has positions in Nike. The Motley Fool has positions in and recommends Nike and Skechers U.s.a. The Motley Fool recommends On Holding. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
EURUSD Long-term Forecast: Can ECB Hawks Overcome the Dollar Bullishness? As one of the most traded currency pair in the forex markets, the price of EURUSD affects many traders. Check out our EURUSD long-term forecast for more information.
Author  Mitrade
Mar 13, 2023
As one of the most traded currency pair in the forex markets, the price of EURUSD affects many traders. Check out our EURUSD long-term forecast for more information.
placeholder
Bitcoin CME gaps at $35,000, $27,000 and $21,000, which one gets filled first?Prioritize filling the $27,000 gap and even try higher.
Author  FXStreet
Aug 21, 2023
Prioritize filling the $27,000 gap and even try higher.
placeholder
Natural Gas sinks to pivotal level as China’s demand slumpsNatural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
Author  FXStreet
Jul 01, Mon
Natural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
placeholder
Dogecoin Path To $23? Fibonacci Extensions Hint At Massive Upside With Musk-Trump InfluenceElon Musk’s favorite cryptocurrency, Dogecoin (DOGE), could be on the verge of a massive parabolic rally following the recent victory of Republican U.S. presidential candidate Donald Trump.
Author  NewsBTC
Nov 07, Thu
Elon Musk’s favorite cryptocurrency, Dogecoin (DOGE), could be on the verge of a massive parabolic rally following the recent victory of Republican U.S. presidential candidate Donald Trump.
placeholder
Why Trump Media Stock Is Plummeting TodayDespite Donald Trump's victory in the presidential election, Trump Media stock is losing ground today. While there isn't any new business-specific news for the company or unfavorable political developments for Donald Trump, the social media specialist's share price is moving lower as investors move to take profits on the stock.
Author  The Motley Fool
Nov 08, Fri
Despite Donald Trump's victory in the presidential election, Trump Media stock is losing ground today. While there isn't any new business-specific news for the company or unfavorable political developments for Donald Trump, the social media specialist's share price is moving lower as investors move to take profits on the stock.
goTop
quote