Ralph Lauren vs. Deckers Outdoor: RL stock's significantly higher valuation vs. DECK appears counterintuitive

Last Updated: 12/6/2024

Deckers Outdoor Appears To Be A Better Choice Compared To Ralph Lauren

DECK valuation (P/EBIT) is significantly lower vs. RL, but DECK has performed better on growth and better on margins

This disconnect between valuation and financial performance implies that DECK could be a better buy 

 

Ralph Lauren valuation (P/EBIT) is significantly higher compared to Deckers Outdoor

RL vs. DECK P/EBIT Change In Last 3 Years: -49% vs. -69%

Ralph Lauren revenue growth is worse compared to Deckers Outdoor

RL vs. DECK Revenue Growth:   Last Q: 5.7% vs. 20%; Last 12 Months: 3.7% vs. 19%; Last 3 Years Average: 14% vs. 19%

Ralph Lauren's EBIT margin expansion is worse compared to Deckers Outdoor

RL vs. DECK EBIT Margin Change:   Last 3 Years: 1.0x vs. 1.1x

While Deckers Outdoor appears to be the better choice today, how has its stock performed vs. Ralph Lauren in the past?

Since 2020, returns have been:

  • 151% for Ralph Lauren (RL)
  • 847% for Deckers Outdoor (DECK) 
  • 141% for S&P 500 
  • 627% for Trefis Multi-Strategy Portfolio 

Making Sense Of Counterintuitive Comparisons

Concepts, FAQ, And Things You May Want To Know

[1] What Is The Purpose Of Counterintuitive Comparisons?

[2] How Do You Find These Counterintuitive Pairs?

[3] If I Were To Decide Based On Counterintuitive Comparisons, How Likely Is It That I Will Make The Right Pick?

[4] Where Can I See More Such Counterintuitive Comparisons?

[5] I Don't Want To Go Through Multiple Comparisons, Can You Simplify Investment Decision For Me?

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