Stock Analysis on Net
Stock Analysis on Net

Deckers Outdoor Corp. (NYSE:DECK)

$22.49

This company has been moved to the archive! The financial data has not been updated since February 5, 2024.

Financial Reporting Quality: Aggregate Accruals

Microsoft Excel

Earnings can be decomposed into cash and accrual components. The accrual component (aggregate accruals) has been found to have less persistence than the cash component, and therefore (1) earnings with higher accrual component are less persistent than earnings with smaller accrual component, all else equal; and (2) the cash component of earnings should receive a higher weighting evaluating company performance.

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Balance-Sheet-Based Accruals Ratio

Deckers Outdoor Corp., balance sheet computation of aggregate accruals

US$ in thousands

Microsoft Excel
Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020 Mar 31, 2019 Mar 31, 2018
Operating Assets
Total assets
Less: Cash and cash equivalents
Operating assets
Operating Liabilities
Total liabilities
Less: Short-term borrowings
Less: Mortgage payable
Operating liabilities
 
Net operating assets1
Balance-sheet-based aggregate accruals2
Financial Ratio
Balance-sheet-based accruals ratio3
Benchmarks
Balance-Sheet-Based Accruals Ratio, Competitors4
lululemon athletica inc.
Nike Inc.
Balance-Sheet-Based Accruals Ratio, Sector
Consumer Durables & Apparel
Balance-Sheet-Based Accruals Ratio, Industry
Consumer Discretionary

Based on: 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31), 10-K (reporting date: 2019-03-31), 10-K (reporting date: 2018-03-31).

1 2023 Calculation
Net operating assets = Operating assets – Operating liabilities
= – =

2 2023 Calculation
Balance-sheet-based aggregate accruals = Net operating assets2023 – Net operating assets2022
= – =

3 2023 Calculation
Balance-sheet-based accruals ratio = 100 × Balance-sheet-based aggregate accruals ÷ Avg. net operating assets
= 100 × ÷ [( + ) ÷ 2] =

4 Click competitor name to see calculations.

Net Operating Assets
The net operating assets showed a fluctuating but overall increasing trend over the five-year period. Starting at approximately 487 million US dollars in 2019, the value increased slightly to about 522 million in 2020, then experienced a significant decline to around 355 million in 2021. Following this dip, there was a strong recovery with a sharp rise to approximately 695 million in 2022, continuing upward to nearly 784 million by the end of 2023.
Balance-sheet-based Aggregate Accruals
The aggregate accruals values exhibited volatility with both negative and positive figures, indicating changes in non-cash working capital components. In 2019, the accruals were negative at about -56 million US dollars, shifting to a positive 35 million in 2020. The figure then decreased sharply to a substantial negative value of approximately -167 million in 2021. This reversed again in 2022 with a large positive accrual of about 340 million, followed by a reduction to 89 million in 2023.
Balance-sheet-based Accruals Ratio
The accruals ratio mirrored the fluctuations seen in aggregate accruals, reflecting the proportion of accruals relative to net operating assets. The ratio moved from negative territory (-10.87%) in 2019 to positive (6.87%) in 2020. It then plunged sharply to a negative extreme (-38.04%) in 2021, indicating increased accrual-based adjustments. In 2022, the ratio reached a peak positive value of 64.83%, suggesting significant accrual activity, before decreasing to 11.98% in 2023.
Summary
Overall, the data indicate considerable variability in both net operating assets and accrual measures across the years. The fluctuations in accruals and their ratio point to changing levels of accrual-based accounting adjustments, possibly reflecting shifts in operational dynamics or accounting policies. The strong recovery and growth in net operating assets from 2021 onwards coupled with volatile accrual ratios highlight a period of financial and operational transformation during the analyzed years.

Cash-Flow-Statement-Based Accruals Ratio

Deckers Outdoor Corp., cash flow statement computation of aggregate accruals

US$ in thousands

Microsoft Excel
Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020 Mar 31, 2019 Mar 31, 2018
Net income
Less: Net cash provided by operating activities
Less: Net cash used in investing activities
Cash-flow-statement-based aggregate accruals
Financial Ratio
Cash-flow-statement-based accruals ratio1
Benchmarks
Cash-Flow-Statement-Based Accruals Ratio, Competitors2
lululemon athletica inc.
Nike Inc.
Cash-Flow-Statement-Based Accruals Ratio, Sector
Consumer Durables & Apparel
Cash-Flow-Statement-Based Accruals Ratio, Industry
Consumer Discretionary

Based on: 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31), 10-K (reporting date: 2019-03-31), 10-K (reporting date: 2018-03-31).

1 2023 Calculation
Cash-flow-statement-based accruals ratio = 100 × Cash-flow-statement-based aggregate accruals ÷ Avg. net operating assets
= 100 × ÷ [( + ) ÷ 2] =

2 Click competitor name to see calculations.

Net Operating Assets
The net operating assets demonstrated a fluctuating but overall increasing trend over the five-year period. Beginning at approximately 487 million US dollars in 2019, the figure rose modestly in 2020 to roughly 522 million. However, a decline occurred in 2021, lowering the value to about 355 million. Subsequently, a notable recovery was observed, with significant increases to around 695 million in 2022 and further to approximately 784 million in 2023. This pattern indicates variability in the asset base but an overall expansion by the end of the period analyzed.
Cash-Flow-Statement-Based Aggregate Accruals
The aggregate accruals, measured in thousands of US dollars, exhibited substantial volatility throughout the period. In 2019, the accruals were negative at approximately negative 66 million, which shifted to a positive figure of around 22 million in 2020. This was followed by a pronounced negative swing in 2021, with accruals plunging to about negative 181 million. The subsequent years showed a reversal to positive values again: around 331 million in 2022 and a decline to approximately 60 million in 2023, yet still positive. These large oscillations suggest significant changes in the company’s accrual management and potentially varying earnings quality or accounting policies impacting reported figures.
Cash-Flow-Statement-Based Accruals Ratio
The accruals ratio, expressed as a percentage, mirrored the volatility in aggregate accruals. In 2019, the ratio was negative at about minus 12.85%, indicating negative accruals relative to net operating assets. The ratio turned positive in 2020, increasing to approximately 4.32%. In 2021, the ratio sharply decreased to negative 41.41%, reflecting the large negative accruals relative to the asset base. The following year witnessed a significant jump to 62.96%, representing a substantial positive accrual relative to net operating assets. This ratio receded to 8.17% in 2023 but remained positive. These fluctuations highlight considerable variability in accrual-based earnings adjustments that impact the overall financial reporting quality.