Tapestry — Owner Of Fashion Brand Coach — Is A "Structural Pandemic Winner," Jefferies Says In Upgrade: What Else Impressed This Analyst?

Tapestry Inc TPR has been through a culture change focusing on data-driven results, which should continue to drive progress, according to Jefferies.

The Tapestry Analyst: Ashley Helgans upgraded the rating for Tapestry from Hold to Buy, while raising the price target from $30 to $45.

The Tapestry Thesis: The company’s financial profile has improved significantly and a new leadership team is in place, Helgans said in the upgrade note.

“The shift to high-margin channels (e.g. digital to 1/3, only 10% wholesale), increases in global AURs, and lower promos are helping margins expand +250bps in FY22E vs. FY19, while sales are +11%,” the analyst wrote. Luxury goods “tend to hold up better during recessionary periods due to the emotional nature of the purchase,” Helgans added.

While China represents a long-term opportunity, there is upside to near-term estimates as lockdowns in the country ease and “the gov't presumably adds stimulus,” Helgans mentioned.

TPR Price Action: Shares of Tapestry had risen by 4.59% to $33.05 at the time of publication Wednesday.

Photo: Sorbis via Shutterstock

Posted In: Ashley HelgansfashionJefferiesAnalyst ColorUpgradesPrice TargetAnalyst RatingsTrading Ideas

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.