Buy 2 Apparel & Shoes Stocks on Solid Guidance and Estimate Revisions

The apparel and shoes industry entered 2026 on a relatively stable note despite a volatile macroeconomic environment, with demand increasingly shaped by more selective, value-conscious consumers and faster-moving trends.

This space is benefiting from strong premiumization and digital momentum. Consumers are increasingly gravitating toward performance-driven, high-quality products that blend comfort, durability and style, supporting higher price points and stronger brand loyalty.

The Zacks-defined Retail – Apparel and Shoes industry is currently within the top 20% of the Zacks Industry Rank. Since it is ranked in the top half of the Zacks Ranked Industries, we expect it to outperform the market over the next three to six months.

Here, we recommend two apparel and shoes stocks with a favorable Zacks Rank that have provided a strong outlook for the rest of 2026. These two stocks have also seen positive earnings and revenue estimate revisions. 

The stocks are: Deckers Outdoor Corp. DECK and Victoria’s Secret & Co. VSXY. Each of our picks currently carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our two picks in the past three months.

Image Source: Zacks Investment Research

Deckers Outdoor Corp.

Zacks Rank #2 Deckers Outdoor continues to build on its strong growth momentum, supported by sustained strength at HOKA and UGG, healthy international demand, disciplined execution and strong full-price selling. 

HOKA is benefiting from rising global brand awareness, product innovation and expanding market share, while UGG continues to gain traction through broader product diversification and solid consumer engagement. DECK also maintains a strong financial position with no debt, robust cash generation and ongoing share repurchases that reinforce shareholder returns.

Strong Outlook

For the second quarter of fiscal 2027, DECK expects consolidated revenues to increase approximately 5% year over year. Earnings per share are expected to be in the range of $1.73-$1.78.

For fiscal 2027, DECK continues to expect consolidated net sales in the range of $5.86-$5.91 billion, representing high-single-digit growth from the prior year. The company raised its fiscal 2027 earnings per share guidance to $7.35-$7.50, as compared with its prior outlook of $7.30-$7.45, driven by higher expected gross margin.

Solid Estimates Revision

For fiscal 2027 (ending March 2027), the Zacks Consensus Estimate currently shows revenues of $5.90 billion, suggesting an improvement of 7.9% year over year and earnings per share of $7.49, indicating an increase of 6.7% year over year. The Zacks Consensus Estimate for the current year has improved 0.4% in the last seven days.

For fiscal 2028, the Zacks Consensus Estimate currently shows revenues of $6.41 billion, suggesting an improvement of 8.6% year over year and earnings per share of $8.28, indicating an increase of 10.5% year over year. The Zacks Consensus Estimate for the current year has improved 0.5% in the last seven days.

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Victoria’s Secret & Co.

Zacks Rank #1 Victoria’s Secret is executing a broad-based turnaround supported by strengthening brand relevance, healthier customer engagement and disciplined operational execution. Momentum is being driven by renewed leadership in VSXY’s core bra business, growing appeal among younger consumers and expanding traction across PINK, Beauty and international markets. 

VSXY’s Path to Potential strategy is translating into stronger full-price selling, improved merchandising and more effective brand storytelling. Continued investment in product innovation, store modernization and digital engagement should reinforce customer loyalty and market share gains. 

With management raising its sales outlook and maintaining a robust pipeline of launches, partnerships and global expansion initiatives, VSXY appears well-positioned to deliver sustainable growth.

Strong Outlook

Following the upside performance, VSXY raised its 2026 outlook. Net sales are expected to be in the range of $7.03-$7.13 billion, up from the prior $6.85-$6.95 billion range, while adjusted operating income is forecasted to be in the range of $550-$580 million compared with the earlier guided range of $430-$460 million. Adjusted earnings per share are expected to be in the range of $4.35 to $4.60 compared with the previous guided range of $3.20-$3.45.

Near-term expectations also moved higher. For the second quarter of fiscal 2026, VSXY projected net sales of $1.590-$1.615 billion and operating income of $90-$100 million. On the earnings side, the company guided to earnings per share of approximately 65-75 cents for the second quarter.

Solid Estimates Revision

For fiscal 2026 (ending January 2027), the Zacks Consensus Estimate currently shows revenues of $7.15 billion, suggesting an improvement of 9% year over year and earnings per share of $4.65, indicating an increase of 55% year over year. The Zacks Consensus Estimate for the current year has improved 0.9% in the last 30 days.

For fiscal 2027, the Zacks Consensus Estimate currently shows revenues of $7.49 billion, suggesting an improvement of 4.9% year over year and earnings per share of $5.54, indicating an increase of 19.1% year over year. The Zacks Consensus Estimate for the current year has improved 1.1% in the last 30 days.

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This article originally published on Zacks Investment Research (zacks.com).

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