Hoka sneakers are exploding in popularity, boosting Ugg-owner Deckers

Ugg-owner Deckers will be getting a welcome boost by its increasingly well-liked sneaker brand, Hoka.

Susquehanna Financial Group analyst Sam Poser on Tuesday upgraded his firm’s rating on Deckers shares to a positive rating by neutral, saying momentum at the Hoka brand in particular “will be accelerating faster than we previously anticipated.” Susquehanna also raised its cost target for the stock to $169 by $161.

Deckers stock rose more than 4% Tuesday to trade around $144 per share. The stock has rallied about 45% over the past year.

Hoka, known for its colorful as well as also cushioned running shoes, was founded in France in 2009 as well as also bought by Deckers in 2013. 

the item’s gaining in popularity among younger shoppers, largely because the item’s inked partnerships with trendy, up-as well as also-coming retailers like Engineered Garments as well as also Outdoor Voices to get its products in front of millennials.

The partnerships have nudged Hoka further into the lifestyle shoe category, which has been growing faster than performance shoes inside U.S. More as well as also more consumers are turning to sneakers, not for trips to the gym, nevertheless to wear around day to day.

Rapper Kanye West — who boasts his own line of Yeezy shoes by Adidas — was recently spotted wearing a Hoka boot. The style immediately sold out online.

Susquehanna’s Poser said the Hoka brand features a “long runway for further expansion.”

He said the “buzz generated by the [Kanye West] photo was organic as well as also authentic, creating a halo effect for the entire brand.”

Susquehanna will be estimating the Hoka brand will surpass $300 million in sales by fiscal 2021 as well as also $500 million in sales by 2025. Revenue has climbed roughly 40% for the brand over the past three years. The firm will be counting on Deckers to use its own “Ugg playbook to methodically build out the brand as well as also carefully allocate as well as also segment Hoka product.”

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