Coach 3Q07 Earnings Review
-
Font Size:
COH reported sales of $625 million versus driven by strong comps in U.S. Retail (15.1%, Factory (26.6%). Operating margins were up an impressive +300bps, Year over Year. Gross margins were disappointing but were offset with some savings on the administrative side and they expect GM to regain traction in the upcoming quarters as the company introduces higher margin coated canvas handbags.
COH is exiting its Small Corporate Accounts business (to increase its brand control), which contributed 1c of income in the quarter and was expected to contribute 10c for 2007. COH trades at 15x EV/EBITDA and 27x calendar 2007 EPS, a premium to its peers but a discount to its historical P/E average of 28x. The multiple can be justified, with room to expand given high and consistent returns on capital, strong cash flow, near 25% sustainable earnings growth, and recent acceleration in the business.
Coach shares have been an impressive investment since the company’s IPO, and think the strong performance will continue.
COH 1-yr chart
COH 1-yr chart
- The Cheesecake Factory F2Q08 (Qtr End 7/1/08) Earnings Call Transcript »
- Pool Corporation Q2 2008 Earnings Call Transcript »
- Build-A-Bear Workshop, Inc. F2Q08 (Qtr End 06/28/2008) Earnings Call Transcript »
- Tupperware Brands Corporation Q2 2008 Earnings Call Transcript »
- Starwood Hotels & Resorts, Q2 2008 Earnings Call Transcript »
Get Seeking Alpha Free Stock Alerts by Email!
Get Free Stock Alerts by Email!
-
Editor's Picks
-
Most Popular
- The Nature of a Crowded Trade: This Time It's Housing
- American Express Calls Investment Banks' Bluff
- Japan: Recession-Bound As Exports Slow?
- iShares MSCI Mexico: Surprising Strength South of the Border
- A Fed Rate Hike Won't Solve the Current Crisis
- Understanding Metastorm's IPO as an Investment Opportunity
- Full list of Editor's Picks »
- Three Stocks To Be Held To Infinity and Beyond »
- As WaMu, Wachovia Ready Earnings, Comparisons to Wells, USB Are Telling »
- Wall Street Breakfast: Must-Know News »
- Steve Jobs' Health: A Red Herring »
- Financials: How - And When - We Reached the Bottom »
- Four Long-Term Winners Selling at Deep Discounts »
- Apple F3Q08 (Qtr End 6/28/08) Earnings Call Transcript »
- Earnings Preview: Washington Mutual »
- The Agriculture Boom Goes Bust »
- Crazy Dividends »
- Apple's a Buy Under $150 »
-
Long Ideas
-
Short Ideas
-
Cramer's Picks
- TUP Up - Cramer's Mad Money (7/24/08)
- Buy Rent-A-Center -- Cramer's Lightning Round (7/24/08)
- Citi vs XTO Energy -- Cramer’s Stop Trading! (7/24/08)
- Potash Corp. Earns $2.82, a 220% Increase
- Mechel Drops 20% on Putin's Comments
- Auto Retailers' Ability to Pay Debt - What It Means
- Three Conservative Growth Industrial Picks: Adminstaff, Carlisle Companies and Illinois Tool Works
- Wait for August FFIEC Call Reports Before Taking a Long Position in Banks
- Now's the Time to Buy Something
- 3Com Corp.: Undervalued by Half
- Full list of Long Ideas »
- Collateral Damage From the War on Shorts
- Is the Gold Uptrend Over?
- Response to Raymond James' Q3 Conference Call
- eBay is a Not Com - Cramer's Lightning Round (7/23/08)
- Get True Religion - Cramer's Lightning Round (7/22/08)
- Principal Financial Group Vulnerable to Commercial Real Estate Softening?
- Increases in Shorting, Only for Some
- Is a Ban on Short Financial ETFs on the Horizon?
- Is There a More Efficient Shorting Tactic?
- Short Oil as a Long Investment
- Full list of Short Ideas »
- TUP Up - Cramer's Mad Money (7/24/08)
- Buy Rent-A-Center -- Cramer's Lightning Round (7/24/08)
- Citi vs XTO Energy -- Cramer’s Stop Trading! (7/24/08)
- eBay is a Not Com - Cramer's Lightning Round (7/23/08)
- Buy Costco, Get Sirius - Cramer's Stop Trading! (7/23/08)
- Soup Target; Cramer's Mad Money (7/22/08)
- Get True Religion - Cramer's Lightning Round (7/22/08)
- Copper Down Low - Cramer's Stop Trading! (7/22/08)
- Banks Hit Bottom – Cramer’s Mad Money (7/21/08)
- Ends In X - Cramer's Stop Trading! (7/21/08)
- Full list of Cramers Picks »
Most Popular Feeds
-
ETFs
-
US Market
-
Long Ideas
-
Alt. Energy
- Full list of feeds »
Hedge Fund Jobs
Job Seekers:
- Search jobs by category
- Get job alerts by email or live feed
- Apply online
Employers
- See all recruitment options
- Get applications online or by email


