Retail stock Deckers Outdoor Corp (DECK) sports an 87.4% lead for 2024, and is today on track for its fourth gain in the last five sessions. The shares are also fresh off a Dec. 20, all-time high of $214.70, with support from the 20-day moving average containing several pullbacks since early November. Plus, a historically bullish signal now flashing indicates there is room for more record peaks going forward.
Specifically, Deckers stock’s recent high coincides with historically low implied volatility (IV) — a combination that has generated tailwinds in the past. According to data from Schaeffer’s Senior Quantitative Analyst Rocky White, there were five times over the last five years when the equity was trading within 2% of its 52-week high, while its Schaeffer’s Volatility Index (SVI) sat in the 20th annual percentile or lower. This is the case with the stock’s current SVI of 27%, which sits in the 14th annual percentile.
Data shows that one month after those signals, the equity was higher 80% of the time to average a 5.7% gain. From its current perch of $208.70, a similar move would put DECK at a new record high of $220.59. There is still room for optimism amongst the brokerage bunch, too, with nine of the analysts in coverage calling the stock a tepid “hold,” while the 12-month consensus target price of $202.15 is a 3% discount to current levels.
What’s more, the stock’s Schaeffer’s Volatility Scorecard (SVS) sits at an elevated 95 out of 100. This means DECK has consistently outperformed volatility expectations in the last 12 months.
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