Michael Kors Stock Set For Strong Performance Before, During, And After February 5
- A recent survey suggests KORS North American growth will push revenue beyond expectations for the holiday season.
- KORS valuation suggests the stock has great upside potential.
- Fears of margin pressure are overstated.
- JPM buy-side survey showed 29% picked KORS as their favorite 2015 turnaround candidate.
- Top-line growth powered by Europe and Asia should offset lower EBIT margins.
- At 16 times fiscal year 2015 earnings and above 14% CAGR the PEG is a reasonable 1.1.
- From a financial standpoint, KORS is an extremely-profitable and efficiently-operated luxury retailer.
- From a qualitative standpoint, KORS is well positioned to continue its upswing to being a dominant player in the luxury retail space.
- From a quantitative standpoint, KORS has a present value of roughly $94 per share, or nearly 40% upside to today's price.
Update: Latest Pullback Offers A Great Opportunity In Michael Kors
- Credit Suisse downgraded shares of Michael Kors resulting in a 9% drop.
- The company is projected to continue to grow at an impressive pace.
- The company is approaching oversold territory and is.
- Slowing comps and changes in analyst sentiment drove Michael Kors down 10% for the year in 2014, and 30% from its February 2014 high.
- The sharp drop in share price makes Michael Kors undervalued with huge potential upside.
- Look for Kors to regain ground in 2015 and beyond.
- Michael Kors is trading at a low valuation.
- This valuation is not warranted given its growth potential.
- The company had a great Christmas, according to survey results and Google trends.
- Michael Kors' social media strategy is great, with an immense following on Instagram.
- Michael Kors, the man, represents a differentiating factor from Kate Spade.
Michael Kors Now A Value Stock With 20%+ EPS Growth
- Kors shares have been sold off since my buy recommendation in August.
- But I believe the reasons for the selloff are dubious and can be refuted.
- I think the stock is very cheap at 14 times next year's earnings and what I think will be in excess of 20% EPS growth.
4 Reasons Michael Kors Investors Should Overlook Credit Suisse's Downgrade
- Michael Kors stock collapsed on Tuesday behind a downgrade from Credit Suisse.
- While the firm’s reasons are valid for concern, there are four specific reasons why investors should buy on the weakness.
- Specifically, KORS has a near unprecedented mix of value and growth to compliment industry-high margins.
- Since its IPO, Michael Kors has outperformed the S&P500 because of its extraordinary EPS and revenue growth.
- The stock suffered last year due to comparable-store sales disappointment and slow-growing fears about the prospects of the company’s operating margin.
- Opportunities on the horizon indicate that there may be more room to expand.
Michael Kors Appears Undervalued By 60% Thanks To Earnings Growth Outlook, Pristine Balance Sheet
- After three years of impressive performance following its IPO, Michael Kors has struggled since February due to declining same store sales growth.
- However, the firm maintains a debt free balance sheet with over $1 billion in cash and generates terrific returns on its invested capital.
- Now trading at below 20 times forward earnings, this DRAG analysis suggests that Michael Kors' shares could gain more than 60% over the next year.
- Michael Kors will benefit from a booming market for jewelry and watches by opening more stores centered on these products.
- Kors has an aggressive e-commerce plan that will help the company attract more customers.
- Kors has a debt-free balance sheet that will allow it to invest aggressively in its e-commerce and retail operations to sustain long-term growth.
- Macy's and Piper Jaffray both note KORS as a top holiday retail performer.
- Strong North American growth could catapult shares of KORS.
- Emerging markets remain strong for KORS.
Kors: International Expansion, Eyewear And Buyback Should Boost
- After reporting earnings that represented high growth, Kors has been mired in the low $70s.
- Europe and the Far East offer continued opportunities for more stores and higher revenues.
- Luxottica license deal set to start early next year will help Kors capitalize on Europe's potential.
- Although KORS beat the analysts' estimates in its fiscal Q2 by a wide margin, the stock has declined 12% since the report.
- As the company has exhibited excellent performance, the pronounced decline of its stock this year is due to a great reduction of the P/E ratio the market assigns to it.
- The article analyzes the reasons for the great reduction in the P/E of the stock.
- Michael Kors reported fiscal Q2 2015 earnings and revenue ahead of estimates.
- Comparable sales growth in North America was disappointing as well as the fiscal Q3 and full-year guidance for comp growth is lower than expected.
- Ramped-up investment cycle is causing a contraction in operating margins.
- High growth, continued expansion, international growth opportunities and the announced buyback should bring balance and may lead to a sustainable bottom in the next couple of weeks.
- I am upgrading Kors back to buy.
Let's Put Michael Kors' 'Disappointing' Quarter In Perspective
- A realistic analysis of KORS Q3 without Wall Street expectations.
- KORS valuation multiple is now cheaper than inferior companies like COH and RL.
- The reason that KORS stock has fallen, and its multiple has fallen.
Update: Michael Kors Fiscal Q2 Earnings Solid But Investors Concerned
- KORS beat consensus on the top and bottom lines.
- We felt that KORS would continue to see weakness as the markdowns appeared to continue to rise.
- We are still bearish on KORS and prefer COH.
Coach Or Michael Kors: Which Luxury Retailer Posted Stronger Quarterly Results?
- Coach reported Q1 earnings on October 28.
- Michael Kors reported Q2 earnings on November 4.
- Both companies exceeded analysts' expectations.
- Both stocks have reacted by making moves to the downside.
Fri, Jan. 23, 7:03 AM
Wed, Jan. 21, 9:59 AM| 5 Comments
Fri, Jan. 9, 11:04 AM
- Another tough day for luxury retail stocks as more concerns on pricing trends build up.
- Consulting firm Bain isn't helping sentiment, noting the luxury sector in China showed negative growth (-1%) for the first time in 2014. An ongoing crackdown by Beijing on corruption is in the background.
- Michael Kors (KORS -1.7%), Ralph Lauren (RL -2%), Kate Spade (KATE -3.2%), Fossil (FOSL -1%), Vera Bradley (VRA -2%), and Coach (COH -2.2%) are all under-performing market averages.
- Related stocks: OTCPK:LVMUY, OTC:GUCG, OTCPK:SWGAY, OTCPK:BURBY, EL, RDEN, OTCPK:HESAF, OTCPK:CFRUY, TIF.
- Related ETFs: PEJ.
Tue, Jan. 6, 9:40 AM
- Shares of Michael Kors (KORS -6.6%) turn lower after Oppenheimer downgrades the stock to Neutral from Outperform.
- The investment firm slashed the price target on shares to $79 from $103.
- The dour outlook on Michael Kors is based on a channel check which showed a high level of promotional activity for MK handbags over the last month.
- Sector news: Coach nabs Stuart Weitzman.
Dec. 23, 2014, 2:59 PM
- The strong reads on consumer spending (ICSC, Redbook) bode well for Q4 earnings in the retail sector, note analysts.
- Electronics sellers (BBY, HGG) and the luxury sector (RL, TIF, COH, KORS, KATE, FOSL, VRA) are viewed as being in a good position to see a December boost.
- Companies which eased off on pulling a bulk of their sales forward with Black Friday/Cyber Monday deals are also seen as potential winners with sub-$2 gas resetting some holiday budgets.
- Though e-commerce is expected to dazzle again this holiday season. It's not all fun and games for analysts looking at margins. The extension by Amazon (AMZN -0.1%) of its free shipping offer could be a signal that inventory levels are higher than anticipated and that the growth-at-all-costs mentality at the company is as entrenched as ever, notes Nasdaq Advisory Services.
- The S&P Retail ETF (NYSEARCA:XRT) has doubled up the return of the S&P 500 over the last 3 months, 10.8% vs. 5.1%.
- Previously: Retail trends to watch: Athleisure, P-E buyouts, and new online channels (Dec. 20 2014)
- Related ETFs: XLP, XLY, VDC,VCR, RTH, RETL, FXG, PBJ, IYK, PEJ, FXD, IYC, FDIS, RHS, SCC, FSTA, UCC, PMR, PSL, UGE, RCD, PEZ, PSCC, PSCD, SZK
Dec. 19, 2014, 1:29 PM
- Analysts expect a mixed holiday season for the retail sector in Hong Kong.
- While mass market retail is forecast to hold up with the level of demonstrations in the region moderating, there's some concerns on the luxury sector.
- The corruption crackdown by Beijing and the weak Yen are two potential drags on tourist traffic.
- Consumer confidence on the high end has also been weakening.
- What to watch: The critical Chinese New Year begins in February giving the luxury sector scant time for the environment to improve.
- Luxury sellers in HK: Gucci (OTC:GUCG), Prada, Louis Vuitton (OTCPK:LVMUY), Coach (NYSE:COH), Ralph Lauren (NYSE:RL), Michael Kors (NYSE:KORS), Swatch (OTCPK:SWGAY), Burberry (OTCPK:BURBY), and Tiffany (NYSE:TIF).
Dec. 18, 2014, 7:01 AM
- Apparel prices fell 1.1% in the U.S. during November, according to yesterday's CPI report.
- The drop followed a 0.2% slide in apparel prices for October.
- Retail analysts note that a higher mix of e-commerce sales and the lingering promotional haze threaten margin expansion in the sector, despite overall tighter inventory control.
- Apparel stocks: KATE, ANN, LULU, PVH, VNCE, CRI, UA, HBI, VFC, COLM, GIL, SQBG, JCP, KSS, DDS, M, JWN, RL, ARO, AEO, ANF, WTSL, TLYS, CACH, ZUMZ, PSUN, EXPR, BKE, KORS, UA, GIII, SQBG, HBI, SKX, FL, VRA, ICON, NKE, WWW, DECK, CROX, SHOO, BWS, PERY, DXLG, SHLD, BONT, GPS, GES, URBN.
Dec. 12, 2014, 10:17 AM
- The S&P Retail ETF (XRT +0.5%) is out ahead of market averages again on enthusiasm over consumer spending forecasts.
- Today it's apparel/footwear sellers and department store chains with the broad set of gains.
- Gainers: Lululemon (NASDAQ:LULU) +2.7%, Ralph Lauren (NYSE:RL) +1.0%, Under Armour (NYSE:UA) +1.1%, Sequential Brands (NASDAQ:SQBG) +0.7%, Michael Kors (NYSE:KORS) +0.5%, Coach (NYSE:COH) +2.3%, Nike (NYSE:NKE) +0.7%, Deckers Outdoor (NYSE:DECK) +1.1%, Macy's (NYSE:M) +2.4%, Sears Holdings (NASDAQ:SHLD) +1.7%, J.C. Penney (NYSE:JCP) +1.5%, Nordstrom (NYSE:JWN) +0.8%.
Dec. 4, 2014, 10:31 AM
- Shares of Destination Maternity (DEST -7.8%) slide after the company misses earnings estimates.
- A frank assessment from the company on a misfire with its assortment to millennial-aged moms-to-be strikes a bit of a chord across the apparel and department store sector.
- Many of the earnings hits and misses this quarter have been tied to on-trend or off-trend assortments. A millennial group which is hard to nail down is becoming a bigger part of that puzzle.
- Apparel stocks: KATE, ANN, LULU, RL, PVH, VNCE, CRI, UA, HBI, VFC, COLM, KORS, GIL, SQBG, JCP, KSS, DDS, M, JWN, RL, ARO, AEO, ANF, WTSL, TLYS, CACH, ZUMZ, PSUN, EXPR, BKE, KORS, UA, GIII, SQBG, HBI, SKX, FL, VRA, ICON, NKE, WWW, DECK, CROX, SHOO, BWS, PERY, DXLG, SHLD, BONT, GPS, GES, URBN, TJX.
Nov. 18, 2014, 10:18 AM
- Piper Jaffray comes up with an eclectic mix as part of its five best retail stock picks for the holiday season.
- Best Buy (NYSE:BBY): A strong electronics lineup this year bodes well for Best Buy. Ultra HD 4K TVs, iPhone 6s, and GoPro products top many wish lists.
- Coty (NYSE:COTY): A focus on color cosmetics sets up Coty for market share gains this holiday season.
- Del Frisco's Restaurant Group (NASDAQ:DFRG): A bounce in consumer and business expense spending should help this high-end dining name, says Piper.
- Michael Kors (NYSE:KORS): The MK brand is as hot as ever. Consumers in a survey by Piper ranked it as the top fashion brand.
- Nordstrom (NYSE:JWN): The department store operator's best in-class e-commerce operation stands out.
Nov. 12, 2014, 10:37 AM
- Select high-end retailers are in rally mode after Fossil (FOSL +7.3%) cruises past Q3 estimates.
- The strong demand that Fossil saw for higher-priced items bodes well for the sector, say analysts.
- Advancers: Movado (NYSE:MOV) +1.1%, Michael Kors (NYSE:KORS) +1.6%, Coach (NYSE:COH) +1.6%, Vera Bradley (NASDAQ:VRA) +1.1%.
Nov. 6, 2014, 1:27 PM
- Apparel seller Ann issued a warning today on the impact of labor uncertainty at West Coast ports as part of its Q4 guidance.
- The retailer expects $8M in extra air freight costs due to product shipment delays.
- There's also been some reports of delays at ports in the Seattle and Tacoma area which account for 16% of container cargo traffic on the West Coast.
- Analysts fret that more companies will resort to air freight to ensure stores are stocked in front of the Black Friday rush.
- Apparel and footwear stocks: SKX, FL, VRA, ICON, NKE, WWW, DECK, CROX, SHOO, BWS, KATE, ANN, PERY, LULU, RL, PVH, VNCE, CRI, UA, HBI, VFC, COLM, KORS, GIL, SQBG, JCP, KSS, DDS, M, JWN, RL.
Nov. 5, 2014, 12:22 PM
- Shares of Michael Kors (KORS +2.4%) have bounced back a bit after yesterday's post-earnings swoon.
- Some analysts think the North America same-store sales miss (11% vs. 15% expected) is due to a warmer start to the fall selling season, while others see mall traffic in a downward spiral which impacts even red-hot sellers like MK.
- An interesting note nearly lost amid yesterday's earnings information gush is that the company plans to relocate its corporate HQ to Hong Kong from London.
- Previously: Michael Kors beats by $0.11, beats on revenue, Investors not buying Kors beat as holiday guidance is sluggish
Nov. 4, 2014, 9:15 AM
Nov. 4, 2014, 8:38 AM
- FQ2 net income of $207M or $1 per share vs. $145.8M and $0.71 one year ago.
- Comp store sales up 16.4% Y/Y. Retail net sales of $495.6M up 39.4% amid 121 net new store openings over the last year.
- North America revenue of $802.2M up 29.8% Y/Y with 10.8% increase in comp sales; Europe up 108.6% to $237.9M with 41.1% increase in comp sales; Japan up 106.3% to $16.5M with 52.9% increase in comp sales.
- Gross profit of $645M up 43.4%; as a percentage of revenue, gross profit of 61% up 20 bps Y/Y.
- $1B share repurchase program over two years is authorized.
- Guidance: FQ3 revenue of $1.27B-$1.3B, assumes low double-digit comp store sales. EPS of $1.31-$1.34. The Street is at $1.3B and $1.34.
- Full-year fiscal 2015 revenue of $4.3B-$4.4B assumes comp sales growth in the mid-teens. EPS expected at $4.13-$4.18.
- Previously: Michael Kors beats by $0.11, beats on revenue
- Conference call is underway live on Seeking Alpha
- KORS -9.1% premarket
Nov. 4, 2014, 7:08 AM
KORS vs. ETF Alternatives
Michael Kors Holdings Ltd Michael Kors Holdings Ltd is a designer, marketer, distributor and retailer of women's apparel and accessories and men's apparel. The Company's business consists of retail, wholesale and licensing segments.
Other News & PR