Bull Of The Day: Tapestry (TPR)

Formerly known as Coach, Inc., Tapestry (TPR - Free Reportis a luxury retailer that owns and operates the Coach, Kate Spade & Company, and Stuart Weitzman brands. All three offer popular lifestyle products like handbags, clothes, shoes, and fragrance.

top view mall interior photo

Image Source: Unsplash

Shares Pop 10% on Great Q1 Earnings

Following the release of its fiscal first-quarter earnings report, TPR rallied 10% as investors cheered the better-than-expected results.

Revenue came in at $1.48 billion, up 26% year-over-year and 9% higher than pre-pandemic levels, while digital sales surged an impressive 50% over the prior-year period. Regionally, North American sales grew 40% and Chine sales increased 25%.

Gross profit margin jumped to 72.2% from 70.8%, and adjusted earnings came in at $0.82 per share, easily beating the consensus estimate of $0.69.

Because of the great results across the board, Tapestry’s Board of Directors approved an incremental $1 billion share repurchase program. The retailer also declared a quarterly cash dividend of $0.25 per share, with the goal to return $250 million to shareholders through dividends in 2022; shares now yield 2.43% on an annual basis

Can TPR Surge Higher?

Tapestry, Inc. Price

Year-to-date, shares of Tapestry have climbed almost 33%. Estimates have been rising too, and TPR is a Zacks Rank #1 (Strong Buy) right now.

For fiscal 2022, eight analysts have revised their bottom-line estimate upwards over the last 60 days, and the Zacks Consensus Estimate has moved up 16 cents to $3.50 per share. Earnings are expected to grow about 17.8% compared to the prior year, and in 2023, Tapestry’s bottom line is forecasted to increase another 12.2%.

Looking ahead, Tapestry increased its revenue target from $6.4 billion to $6.6 million for the year, which would be a record for the company. Tapestry also upped its EPS range from $3.30 to $3.35 to $3.45 to $3.50.

Over the years, Tapestry’s many brands have built a large customer following. Combined with its bullish guidance for the rest of the year, this brand loyalty will likely help the retailer expand its footprint and grow its market share even as the Covid-19 crisis lingers.

If you’re an investor searching for a retail stock to add to your portfolio, make sure to keep TPR on your shortlist.

Disclaimer: Neither Zacks Investment Research, Inc. nor its Information Providers can guarantee the accuracy, completeness, timeliness, or correct sequencing of any of the Information on the Web ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.