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Afam Edozie  

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  • Coach Results - The Good, The Bad, And The Ugly [View article]
    Never possible to tell the future, it hasn't happened yet.

    At this price Coach is fair value, with potential for upside if it can sort out the issues that are apparent from this quarter. If it can't then its still fair value.

    I don't expect the price to do anything before next quarters results (though you never can tell, we could always have a storming bull market.)

    If they are able to sort themselves out you should see $75 within 12 months. If not then price should languish around where it is now (maybe a 45 to 55 range.)

    I am not a buyer at today's price, I prefer a margin of safety, but I'm not a seller either (I am long COH), I believe (no proof though) that it will sort out its US business before the end of the year (though there is no evidence either way). I think your decision should be based on opportunity cost. Could you get better for your $51.
    Jan 24, 2013. 11:52 AM | Likes Like |Link to Comment
  • Coach Vs. Kors: Who Will Win The Handbag Wars? [View article]
    I had made the assumption that it was a combination of new customers (Kors popularity has been on the increase) and store ramp up. But I have not done a detail analysis of their same store sales, to know for sure where they come from. I decided at an earlier stage not to buy because it was expensive for me.
    Jan 21, 2013. 05:50 AM | 1 Like Like |Link to Comment
  • Coach Vs. Kors: Who Will Win The Handbag Wars? [View article]
    Interesting, how they deal with problems like this says a lot about the customer culture. That it happened twice is a red flag.When I get a chance I will ask at the Dept store what their customer complaint levels are vs. Coach, and also the company policy. At this level bags should be guaranteed for at least 12 months.
    Jan 18, 2013. 02:49 AM | 1 Like Like |Link to Comment
  • Coach Vs. Kors: Who Will Win The Handbag Wars? [View article]
    A new store tends to take 3 or more years to reach steady state (most firms will have a good statistical picture - chart - of progress, so pretty much based on the first 3 months of trading they can tell where the store will be in 3 years time - thereby ablle to make early decisions.)

    Same store sales buts all stores that have been open for more than 12 months in the bucket. Many of the stores that have been open less than 2 or 3 years will still be ramping up.

    If like Kors you are ramping up (i.e. a high percentage of your stores have been open between 2 to 3 years) then there high growth will bump up the average. Hence your 30%

    If you have the store growth curve, sales by store age group, and new store opening plan, you can easily forecast very accurately the growth pattern over the next 3 years.
    Jan 17, 2013. 04:04 PM | 1 Like Like |Link to Comment
  • Coach Vs. Kors: Who Will Win The Handbag Wars? [View article]
    Kelli. Thanks for your insight. I agree with Peter Lynch, that true end users like yourself have a significant investing edge and your opinion outweighs a lot of dry analysis.
    Jan 17, 2013. 03:32 AM | 2 Likes Like |Link to Comment
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