Industry Analysts Just Upgraded Their Deckers Outdoor Corporation (NYSE:DECK) Revenue Forecasts By 11%

Deckers Outdoor Corporation (NYSE:DECK) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.

Following the upgrade, the most recent consensus for Deckers Outdoor from its eleven analysts is for revenues of US$3.0b in 2022 which, if met, would be a substantial 27% increase on its sales over the past 12 months. Per-share earnings are expected to grow 13% to US$14.77. Prior to this update, the analysts had been forecasting revenues of US$2.7b and earnings per share (EPS) of US$14.50 in 2022. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

Check out our latest analysis for Deckers Outdoor

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The consensus price target increased 5.4% to US$412, with an improved revenue forecast carrying the promise of a more valuable business, in time. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Deckers Outdoor analyst has a price target of US$435 per share, while the most pessimistic values it at US$350. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Deckers Outdoor's rate of growth is expected to accelerate meaningfully, with the forecast 27% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 4.8% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Deckers Outdoor to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Deckers Outdoor.

Using these estimates as a starting point, we've run a discounted cash flow calculation (DCF) on Deckers Outdoor that suggests the company could be somewhat undervalued. You can learn more about our valuation methodology on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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