Is Deckers Outdoor Corp. overvalued or undervalued?

As of 19 September 2025, the valuation grade for Deckers Outdoor Corp. has moved from fair to attractive, indicating a positive shift in its valuation outlook. The company appears to be undervalued, especially when considering its P/E ratio of 17, which is lower than its peer's average P/E of 17.56. Additionally, Deckers has a robust ROCE of 174.17% and an ROE of 38.44%, suggesting strong profitability relative to its equity and capital employed.
In comparison to its peers, Deckers Outdoor Corp. has a competitive EV to EBITDA ratio of 11.56, which aligns closely with the industry average of 12.21. Despite recent stock performance showing a decline of 43.97% year-to-date compared to a 13.31% gain in the S&P 500, the long-term outlook remains promising, with a 5-year return of 226.81% outpacing the benchmark's 100.77%. This combination of strong financial ratios and favorable valuation metrics supports the conclusion that Deckers Outdoor Corp. is currently undervalued.