Coach Plunges on Earnings Beat

Coach

is down big on Wednesday after a lackluster earnings report. The company missed analysts' expectations by $0.05 per share.

, the average EPS estimate was $1.28. However, the company missed that mark, closing the quarter at $1.23 per share. Revenues also finished below expectations. Analysts hoped for the fine accessories maker to pull in $1.6 billion. Coach finished $100 million below this target, taking in $1.5 billion during the quarter. Overall, the company barely improved its performance on a year over year basis. It closed out the most recent quarter with a net income of $353 million versus $347 million a year ago. Coach Struggling in North America Coach's total North American sales increased 1 percent during the quarter. Direct sales on the continent rose 2 percent while comparable stores sales dropped by the same margin. Department store shipments and sales declined during the quarter, as well, in North America. Commenting on the results, Chairman and CEO Lew Frankfort stated, “…we were disappointed by our performance in North America, where the holiday season proved challenging. Most broadly, the consumer was impacted by a muted macroeconomic environment, while in the Women's handbag category competition intensified and promotional activity increased.” Mixed Overseas Performance Despite struggling on the home front, Coach had a good outing in China. The company reports a 12 percent increase in international sales, which were largely fueled by its success in the East Asian nation. Sales grew 40 percent in the world's second largest economy. In Japan, however, the company wasn't so fortunate. On a constant-currency basis, sales declined 2 percent in the world's third largest economy. Chalk up two strike-outs and a hit for Coach in the big 3 - the US, China and Japan. Coach Downgraded

, Coach was downgraded from “Buy” to “Outperform” by CLSA. The new price target is $71 instead of the previous $79. Market Reaction After being softened up by yesterday's downgrade, investors have pummeled Coach in the morning hours on Wednesday. The downgrade and lackluster earnings report have made Coach the punching bag of choice at the NYSE thus far. After hovering around $61 for over a week, Coach is down nearly $10, sitting above $51 as of this writing. This marks its lowest point since intraday trading on October 4, 2011, when the stock dipped to $48.37. Coach is down a whopping 15 percent on Wednesday.