I have to sell Deckers (DECK) today from the Growth Portfolio. This will close out my position in DECK, which stinks because I purchased the stock on Jun 11, 2009 for only $24.
DECK is breaking out to the downside today, and is currently around $70 — no, make that $69. I feel the stock is in free fall.
There’s a lot of bad things going on with this stock right now.
- Inventory was up 103% last quarter. High inventory is a bad sign for a retail stock. This will likely have to be marked down to sell, hurting profit margins. High inventory also means stores aren’t ordering as many UGGs as DECK may have anticipated, which means demand might be soft.
- DECK issued guidance of 15% sales growth for 2012 with flat profit growth — yes, no growth. First Call has the company making $5.15 this year, up only 1% from the $5.07 it made in 2011.
I love this company, but have to get out of the way of this stock for now. There’s plenty of other companies clicking on all cylinders. I like Deckers and will probably re-purchase the stock when things turn up.
