Looking for opportunities amid the market chaos and Nasdaq correction; A first look at Deckers Outdoor; Bullish report on Crocs; Problems at AppLovin; An Ooler helps me sleep

1) Markets have pulled back somewhat in the past two weeks – led by the tech-heavy Nasdaq Composite Index, which entered correction territory yesterday.

As of yesterday's close, the index is down 10% from its record high back in December.

Looking at just this week, as of yesterday's close the Dow Jones Industrial Average is down about 3%. That puts it on track for its worst week since March 2023. Meanwhile, both the S&P 500 Index and the Nasdaq are on track for their worst week since September 2024.

Rather than panicking about market declines, I welcome them as opportunities to buy or add to the stocks of good companies on the cheap...

So today, let's take a quick first look at a new stock on my radar – footwear maker Deckers Outdoor (DECK). The company is best known for its Ugg sheepskin boots and Hoka running shoes:

Deckers' stock has been a spectacular performer over the past decade... but since hitting an all-time high at the end of January, it has crashed more than 40%:

Looking at the company's soaring revenue and profitability in the past eight years, it's easy to see why the stock has done so well. Take a look at the chart below of revenue and net income by fiscal year:

But when Deckers gave weak guidance when it reported fiscal year 2025 third-quarter earnings on January 30, the stock tumbled more than 20% the next day... and has kept falling.

After a first glance at the stock's move and the strong historical revenue and profitability, that gets me interested in digging deeper. So that's what I'll do – stay tuned next week when I take a closer look at Deckers...

2) Speaking of footwear makers whose stocks have pulled back a lot, I've written a number of times about Crocs (CROX) – most recently in my February 14 e-mail, which linked to my previous commentary.

One of my readers, Daniel B. of Somnium Capital Investments, thinks this pullback is a buying opportunity. He also shared with me his two-page bull case for the stock, which he wrote late last year (and kindly gave me permission to share with my readers – you can see it right here). Excerpt:

Crocs is priced as if on the verge of collapse... The market questions two things: (1) is Crocs a temporary fad, (2) can the [HeyDude] company it bought in 2022 become successful? But if we were to assume Crocs Inc. can just keep revenue growth up with inflation – through international growth and stabilizing [HeyDude] – and we assume some margin-pressure resulting in a lower FCF of $0.75 billion, Crocs can still become debt free in two years and buy back half its market cap in the four years after that. A DCF model assuming 3% annual growth and declining FCF margins from 20% to 15% over the next ten years, shows tripling of the stock price and a 30% margin of safety.

Thank you, Daniel!

On our end here at Stansberry Research, regular readers will recall that Crocs has been in the Stansberry's Investment Advisory model portfolio for the past year and a half. And the stock is now back to nearly the price at which my team first recommended it.

(If you're a subscriber, you can read the full write-up by my colleague Alan Gula right here. If not, you can find out how to become one – and gain access to the entire portfolio of open recommendations and current advice on those positions – by clicking here.)

3) Following up on a point in yesterday's e-mail about avoiding the stock of software maker AppLovin (APP)...

Here's a bearish report on the stock from Edwin Dorsey of The Bear Cave newsletter from late last month (shared with his permission): Problems at AppLovin. Excerpt:

Investors believe AppLovin's ad network business is a beautiful one, as it has extremely high margins, low marginal costs, becomes more effective as it grows, and can one day serve as a growing royalty on the mobile gaming ecosystem. The Bear Cave sees things differently.

The Bear Cave believes AppLovin's rapid rise – up ~750% over the last year to around 35x revenue – is fueled by low-quality revenue growth from ads that are deceptive, predatory, and at times unreadable or unclickable. Today's investigation also explores allegations of potential ad fraud within AppLovin.

4) Lastly, my discussion in yesterday's e-mail about the importance of getting eight hours of sleep generated lots of feedback from readers, so I wanted to share one technique that has worked wonders for my wife and me...

In July 2021, Susan and I got an Ooler for our bed, which we love. It's a system that runs cool water through a mattress pad – you can set the temperature, as low as 55 degrees – so we don't need an air conditioner in our room in the summer and can snuggle under our big down comforter without overheating in the winter.

Here's a picture of the Ooler we have (note that there are two separate tube systems built into the one mattress pad we bought for our king-size bed, so there are two white control boxes, one on each side of the bed, allowing Susan and me to set separate temperatures):

Note that there's now a new system that replaced the older model: Chilipad Dock Pro, which is quieter (we don't mind the Ooler's white noise, but some people might) and has more cooling capacity:

It's not cheap (depending on the size, it can start at about $1,000 per person). But given that we spend roughly a third of our lives sleeping, it's worth it! You can get more information and/or buy one here.

Best regards,

Whitney

P.S. I welcome your feedback – send me an e-mail by clicking here.