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  (Deckers Outdoor Corp.)


(Deckers Outdoor Corp.)

Research Report

Footwear stock a good fit for Buffett, Graham-based portfolios Add to ...

Validea’s pick of the week provides a detailed report on a company that scores well in the stock-screening service’s model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor provides marketing and data services to Validea.ca and receives compensation. Try it.

Deckers Outdoor Corp. offers footwear, apparel and accessories, including such brands as UGG, Teva, and Sanuk. It has a market cap of $1.7-billion (U.S.).

The Benjamin Graham-inspired model gives it high marks, in part because it has no long-term debt. The Graham approach also likes its 2.9 current ratio. It also trades for just 13.2 times three-year average earnings, which the Graham model likes.

Deckers has a reasonable 1.0 price/sales ratio. It has a 19.2-per-cent return on equity over the past ten years, which the Warren Buffett model likes. The company has increased EPS in all but one year of the past decade, which the Buffett model likes. The Buffett-based model also likes its 13.1-per-cent return on retained earnings (those not paid out in dividends) over the past decade.

John Reese is long DECK.


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