Market Overview

Canaccord Expects Tapestry To Deliver Double-Digit EBIT Growth

Canaccord Expects Tapestry To Deliver Double-Digit EBIT Growth
Wells Fargo On Tapestry: Weakness Offers Attractive Entry Point
Benzinga's Top Upgrades, Downgrades For November 14, 2018

Tapestry Inc (NYSE: TPR) is scheduled to report second-quarter earnings Feb. 6. 

The Analyst

Canaccord Genuity's Camilo Lyon reiterated a Buy rating on Tapestry with a $58 price target.  

The Thesis

Lyon is optimistic ahead of the earnings report and said he expects the company to return to double-digit EBIT growth. Canaccord forecasts an EPS of 90 cents, higher than the 89-cent consensus, and Lyon said he expects sales growth of approximately 35 percent. "We are estimating a 12-percent year-over-year decline in Kate sales as TPR has begun enacting its full-price strategy reset by pulling back on Kate flash sales," the analyst said. 

Tapestry's gross margin is expected to improve sequentially through the fourth-quarter before expanding in the first quarter of 2019, Lyon said. 

U.S. tax legislation will add 25 cents or 8 percent to the company's fiscal 2019 EPS, said Lyon. Tapestry had around $1.3 billion of cash outside of the U.S. at the end of the first quarter, he said. Canaccord expects Tapestry to use the cash to invest in its brands, acquisitions and to boost dividends.

The Price Action

Tapestry was down 2.15 percent at $44.97 at the close Monday. It has gained almost 40 percent since the beginning of 2016.

Related Links:

Some Of Coach's Die-hard Customers Aren't Happy With The Name Change

Coach Is Changing Its Name To ... Tapestry? 

Photo from Wikimedia. 

Latest Ratings for TPR

Nov 2018Atlantic EquitiesUpgradesNeutralOverweight
Nov 2018MacquarieInitiates Coverage OnNeutral
Nov 2018CitigroupMaintainsNeutralNeutral

View More Analyst Ratings for TPR
View the Latest Analyst Ratings

Posted-In: Camilo Lyon Canaccord Genuity CNBCAnalyst Color Price Target Reiteration Analyst Ratings Media Best of Benzinga


Related Articles (TPR)

View Comments and Join the Discussion!

Latest Ratings

View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

10 Stocks Moving In Monday's After-Hours Session

Gold Miners Celebrate A Weakening Dollar: 'Inflation Is Coming'