Story updated at 2:20 p.m.:

A second activist investor penned an open letter to Deckers Brands on June 27, demanding the sale of the company or changes to the board of directors as a result of declining share values.

Marcato stated in the letter that it owns 6 percent of the Goleta footwear company’s outstanding common shares. With a market capitalization of $2.16 billion as of June 27, the stake is worth around $129.6 million.

Share prices for the company had rebounded around 20 percent year-to-date after the company announced cost-cutting measures and beat analyst expectations for earnings in May, but the stock still hovers in the mid-$60 range, down from highs of around $99 in the fall of 2014.

Investor Red Mountain Capital Partners, with a 3.3 percent stake in Deckers, had previously written to the company’s leadership to request it explore options for a sale or merger, citing a “persistent underperformance” of Deckers’ stock.

Shares also got a boost after the company announced April 25 that it was hiring an investment banker and considering the possibility of a sale, among other “strategic alternatives.”

In addition to the stock underperformance, the review process initiated by the company lacks transparency and stockholder representation, wrote Marcato Managing Partner Mick McGuire.

“Given Deckers’ chronic underperformance, stockholder frustration and fatigue, a sale of the company in this case very likely offers the highest risk-adjusted return for stockholders,” McGuire wrote, adding that “should Deckers’ strategic review process not culminate in a sale of the company at an attractive value to all stockholders, we will be prepared to seek significant board change at the company’s next annual meeting by nominating a slate of director candidates to replace the entire board.”

In response, Deckers released a statement on June 27 that reads, “We appreciate the views of our stockholders. As previously announced on April 25, 2017, our board of directors is reviewing a broad range of strategic alternatives to enhance stockholder value. As always, our board of directors will continue to take actions that are in the best interests of the company and all stockholders.”

Deckers reported a net loss of $15.76 million for its fourth quarter ended March 31, bringing it to a net loss of $12.7 million for its full fiscal year 2017, compared to $34.6 million in net income the prior year.

Sales continued to slip during the quarter and, while revenues came in ahead of projections, operating expenses also rose. The company outlined a plan to improve operating profits by $100 million by its fiscal year 2020, including a $10 million decrease in net sales, general and administrative expenses this year. Sales are expected to rise to $2 billion by 2020 despite a forecast for flat or slightly decreased revenues for fiscal 2018, said Deckers CEO Dave Powers.

Research conducted by Marcato indicated a $200 million-plus savings opportunity at Deckers that would be better realized by an acquisition, McGuire said.

Marcato alleged that other investors had written to the board to state their preference for a sale of the company and expressed concern that an upcoming bid for mayor of Santa Barbara by Deckers Chairman Angel Martinez would interfere with the company’s strategic review process.

Deckers stock ended up for the day, closing at $67.72 or a 1.2 percent gain.

• Contact Marissa Nall at mnall@pacbiztimes.com.