It’s going to be tougher to scrape the mud off this time.
The maker of Ugg boots and Teva sandals shocked investors with a disappointing earnings report and outlook that sent its shares plunging more than 25 percent — their biggest single-day drop ever.
Deckers Outdoor, which until recently had been a Wall Street darling, said demand in Europe and Asia was weaker than expected amid the financial crisis, despite the fact that the company had already slashed its outlook in February.
CEO Angel Martinez blamed unseasonably warm weather and higher prices for the sheepskin used to make the bulky boots. Deckers now expects a second-quarter loss of 60 cents a share versus a year-ago loss of 19 cents a share.
Tom Brady, who pitches Uggs, could be wearing a long face today after Deckers Outdoors, the footwear maker that produces the once-hot boot brand saw its shares get sacked yesterday, falling 25 percent.
But analysts blasted Martinez for missing his own forecasts twice in a row.
“Management’s credibility is shot,” said Susquehanna analyst Christopher Svezia. “There will be questions as to whether this is in fact the bottom and there is no longer risk to numbers.”
The results surprised investors accustomed to the staying power of Ugg boots, which had defied skeptics who insisted they were a fad.
While Uggs stretched their gains into a multi-year run, critics said the road ahead now looks rockier, as the woolen footwear appears to be losing its cachet with style mavens.
Declines in comparable sales at the company’s stores overseas were “alarming, since this is where the majority of new store openings are planned,” said Canaccord analyst Camilo Lyon, who cut his rating on Deckers shares to “hold” from “buy.”
Deckers expects full-year profit to fall as much as 10 percent, versus its earlier forecast for flat earnings.
Deckers shares plunged $17.63, or 25.6 percent, to close at $51.83.
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