When you think of some of the best stocks of the last generation, tech giants like the “Magnificent Seven” probably come to mind, but you might be surprised to know. Deckers (NYSE: DECK)the manufacturer of footwear brands such as HOKA and UGG, also deserves a place on this list.

Since its IPO in 1993, the stock of sneakers up 9,660%, more than double the gains of Nike during this time.

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Deckers owns smaller brands such as Teva, but Hoka and Ugg have made the big push here. Management acquired both brands in their early days and built them into the world’s top footwear brands through smart design, marketing and distribution, resulting in monster performance for those who have held the stock long enough.

More recently, however, the stock has struggled. Like the others clothing stocksDeckers has faced the twin pressures of tariffs and weak consumer discretionary spending in the US as consumers grapple with inflation and a weak labor market.

As a result, Deckers is down 46% over the past year, but shares soared on its third-quarter earnings report on Friday as the footwear maker surprised Wall Street, easily beating top- and bottom-line estimates and raising its guidance for the fiscal year, sending shares up 19%.

In a challenging environment, Deckers easily beat Wall Street estimates in its third-quarter report, posting revenue growth of 7.1% to $1.96 billion, compared with the consensus of $1.87 billion. Hoka’s sales soared, up 18.5% to $628.9 million, and Ugg was also solid, climbing 4.9% to $1.31 billion in the strongest quarter of the season for the sheepskin boot brand.

Margins remained strong, with operating income up 8.3% to $614.4 million, giving it an operating margin of 31%, and earnings per share up 11% to $3.33, ahead of expectations of $2.76.

Growth was balanced between the wholesale and direct-to-consumer channels, showing an improvement in the e-commerce business, while domestic sales improved from a decline in the previous quarter to 2.7% growth, and international sales rose 15%. The weaker parts of Deckers’ business improved significantly, which is a bright sign for the future.

Customers generally responded to new additions to its product line, including its line of Quill ballet slippers and Ugg slippers.

The strong results led management to raise guidance for the fiscal year, projecting revenue from $5.4 billion to $5.425 billion with Hoka in the mid-teens and Ugg in the mid-single digits.

It also called for earnings per share of $6.80 to $6.85, up from previous guidance of $6.30 to $6.39, which compares with EPS of $6.33 in fiscal 2026.

Deckers shares fell a year ago after the company raised its guidance, but still disappointed the market with its outlook. Since then, although its growth rate has slowed, sentiment toward the stock has been overwhelmingly negative. As the chart below shows, Deckers has topped prior earnings estimates in each of its past four quarters.

Data source: Yahoo! finance

As you can see, Deckers has made a habit of crushing analyst consensus, as the company has beaten estimates by 26% over the past four quarters.

That pattern looks likely to continue, as analysts are now calling for EPS for the current quarter to fall from $1 to $0.82 despite Hoka’s double-digit growth.

Additionally, Deckers remains very reasonably priced, trading at a price-to-earnings ratio of 17, especially considering its growth track record and the S&P 500’s P/E ratio of about 28.

Looking ahead to fiscal 2027, strong third-quarter results bode well for a solid year and possibly accelerating growth. In addition, the company will benefit from the $110 million headwind it has faced due to the application of tariffs on the comparison, and successful new product launches such as Quill should also pay off next year.

Overall, Deckers is performing effectively in a challenging environment and the stock trades at a steep discount to the broader market. Sounds like a smart buy.

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Jeremy Bowman has positions in Nike. The Motley Fool has positions and recommends Deckers Outdoor and Nike. The Motley Fool has one disclosure policy.

This stock is up nearly 10,000% since its IPO and has just taken Wall Street by surprise. Why could it go even higher. was originally published by The Motley Fool