TPR

Tapestry Inc

Consumer


Presented:04/05/2018
Price:$54.00
Cap:$15.47B
Current Price:$45.20
Cap:$10.52B

Presented

Date04/05/2018
Price$54.00
Market Cap$15.47B
Ent Value$13.26B
P/E Ratio48.21x
Book Value$10.36
Div Yield2.5%
Shares O/S286.40M
Ave Daily Vol2,811,613
Short Int4.98%

Current

Price$45.20
Market Cap$10.52B
Tapestry, Inc. is a New York-based house of modern luxury lifestyle brands. The company's portfolio includes the Coach, Kate spade New York, and Stuart Weitzman brands. The products range include footwear; wearable such as scarves, jackets, gloves, and hats; jewelry such as bracelets, necklaces, rings, and earrings; travel bags which include luggage, travel kits, and valet trays; sunwear; watches; and fragrance which includes eau de perfume spray, eau de toilette spray, purse spray, body lotion, and body splashes. The company was founded by Dawn Hughes in 1941 and is headquartered in New York, NY.

Publicly traded companies mentioned herein: Li & Fung Ltd (494 HK), LVMH Moet Hennessy Louis Vuitton SE (MC FP), Michael Kors Holdings Ltd (KORS), Tapestry Inc (TPR)

Highlights

The presenter is long shares of Tapestry (TPR), formerly Coach, and believes the backdrop is more supportive for affordable luxury players. He noted that affordable luxury has historically lagged the luxury segment, and brands such as Gucci and those in LVMH’s portfolio have been showing strong growth recently. With affordable luxury showing signs of a positive inflection, he sees multiple items adding up to create a nice tailwind for the space, including Tapestry’s brands (namely Coach and Kate Spade), Tory Burch, and Michael Kors. Looking out to fiscal 2020, he models $3.60 - $3.70 of EPS, versus the Street’s ~$3.15 estimate; and assuming the stock can trade at 18x – 19x forward earnings the price target range is $65 - $70.

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Idea Discussion

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