The Misfits: Deckers Outdoors Corporation (DECK)

It sure wasn't its Deckers sandals that got it to where it is today.

The Soldier of Marathon announcing the Victory, Jean-Pierre Cortot, 1834, Marble (Louvre)

Are some companies just lucky? Or do they create an environment that allows them to be lucky?

Whenever we think about great businesses, we tend to think of competitive advantages, operational excellence, or forward-thinking management. For a business to achieve stellar stock performance, it has to have a few of these qualities, right? The idea that a company stumbled into an incredible business seems too random to be true.

And yet, when I look at Deckers Outdoors (NYSE: DECK), I can’t decide whether this company is an incredible trendspotter in footwear or one of the luckiest companies on the stock exchange. Over 30 years, its stock has thoroughly outperformed the broader market and even outpaced Nike (NYSE: NKE).

The company’s incredible performance is due to two great decisions over the past 30 years, both of which have transformed a business once headed for the dustbin of history into one of the dominant footwear retailers.

Let’s explore how this company completely remade itself through two strokes of genius (or luck) and what investing lessons we can draw from this.

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