Shares of casual apparel and footwear company Deckers Brands (DECK) were sinking in pre-market trading after the company's Q3 results missed analysts' estimates and it cut its FY17 outlook.

WEAK EARNINGS: Last night after the close, Deckers Brands reported Q3 adjusted earnings per share of $4.11 and revenue of $760.3M, missing analysts' estimates of $4.24 and $788.64M, respectively. Q3 UGG sales were down 5.3%. The year over year decrease was driven by lower domestic wholesale sales, primarily due to a slower than expected start to the quarter, partially offset by stronger than expected DTC comparable sales, the company explained.

FY17 OUTLOOK SLASHED: Looking ahead to Q4, the company forecast adjusted losses of (10c) per share, well below the consensus EPS forecast of 44c. Q4 revenue is expected to fall 5%-6%, versus the consensus of $383.06M. For FY17, Deckers slashed its EPS view to $3.45-$3.55 from $4.05-$4.25, well short of the consensus of $4.14. It also cut its revenue view to down roughly 5% from down 1.5%-3%, versus consensus $1.83B. The company expects total impairment, restructuring, and other charges for fiscal year 2017 to be approximately $150M. This marks the second time the company cut its FY17 outlook, having done so previously on its Q2 earnings report in October.

ANALYST COMMENTARY: This morning, Susquehanna analyst Sam Poser upgraded Deckers to Neutral and lowered his price target to $40 from $46 saying the negative thesis is "played out" following last night's big miss. Poser is encouraged by Deckers' cost savings initiatives but said the real question is whether the company will take control of UGG distribution, inventory levels, and overall UGG brand.

PRICE ACTION: In pre-market trade, shares of Deckers were down over 21% to $43.64.

OTHERS TO WATCH: Other casual apparel and footwear makers include Columbia Sportswear (COLM), Wolverine World Wide (WWW), and Skechers (SKX).