VF (VFC) and Deckers Outdoor (DECK) Critical Comparison

VF (NYSE: VFC) and Deckers Outdoor (NYSE:DECK) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

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This is a summary of recent ratings and recommmendations for VF and Deckers Outdoor, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
VF 1 12 8 0 2.33
Deckers Outdoor 1 8 5 0 2.29

VF presently has a consensus target price of $76.80, suggesting a potential upside of 6.06%. Deckers Outdoor has a consensus target price of $86.23, suggesting a potential downside of 3.34%. Given VF’s stronger consensus rating and higher probable upside, analysts clearly believe VF is more favorable than Deckers Outdoor.

Dividends

VF pays an annual dividend of $1.84 per share and has a dividend yield of 2.5%. Deckers Outdoor does not pay a dividend. VF pays out 121.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Deckers Outdoor has increased its dividend for 45 consecutive years.

Profitability

This table compares VF and Deckers Outdoor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
VF 5.08% 31.49% 12.58%
Deckers Outdoor 4.17% 17.72% 12.43%

Earnings & Valuation

This table compares VF and Deckers Outdoor’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
VF $11.81 billion 2.43 $614.92 million $1.51 47.95
Deckers Outdoor $1.79 billion 1.58 $5.71 million $2.42 36.86

VF has higher revenue and earnings than Deckers Outdoor. Deckers Outdoor is trading at a lower price-to-earnings ratio than VF, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

85.5% of VF shares are held by institutional investors. Comparatively, 99.6% of Deckers Outdoor shares are held by institutional investors. 1.6% of VF shares are held by insiders. Comparatively, 1.9% of Deckers Outdoor shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

VF has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, Deckers Outdoor has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500.

Summary

VF beats Deckers Outdoor on 11 of the 17 factors compared between the two stocks.

About VF

V.F. Corporation (VF) is engaged in the design, production, procurement, marketing and distribution of branded lifestyle apparel, footwear and related products. The Company’s segments include Outdoor & Action Sports, Jeanswear, Imagewear and Sportswear. Its Outdoor & Action Sports Coalition is a group of authentic outdoor and activity-based lifestyle brands. Its product offerings include apparel, footwear, equipment, backpacks, luggage and accessories. Its Imagewear coalition consists of the Image business. Its Wrangler brand offers denim, apparel, accessories and footwear through mass merchants, specialty stores and department stores in the United States, VF-operated stores and online at www.wrangler.com. The Sportswear coalition consists of the Nautica and Kipling brand businesses in North America (the Kipling brand outside of North America is managed by the Outdoor & Action Sports coalition).

About Deckers Outdoor

Deckers Outdoor Corporation is engaged in designing, marketing and distributing footwear, apparel and accessories for both everyday casual lifestyle use and high performance activities. The Company’s segments include operations of its brands, such as UGG, Teva, Sanuk and other brands; wholesale divisions, and Direct-to-Consumer (DTC) business, which includes E-Commerce business and retail store business. The Company sells accessories, such as handbags and loungewear, through domestic and international retailers, international distributors and directly to end user consumers both domestically and internationally, through its Websites, call centers and retail stores. The Company markets its products primarily under three brands: UGG, Teva and Sanuk. The Company’s other brands include Hoka One One (Hoka), Ahnu and Koolaburra by UGG (Koolaburra). It has a total of over 150 retail stores across the world.

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