Core Insights - The U.S. Federal Trade Commission blocked the merger between Tapestry (TPR) and Capri Holdings (CPRI), impacting investor sentiment and market dynamics [1] Company Analysis - Capri Holdings has been under scrutiny following the merger blockage, which may affect its strategic direction and market positioning [1] - The analysis indicates a long position in Capri Holdings shares, suggesting confidence in the company's future performance despite recent challenges [1] Industry Context - The merger blockage reflects ongoing regulatory scrutiny in the luxury goods sector, which may influence future M&A activities within the industry [1]

Core Viewpoint - Prada is considering a takeover of Versace, with negotiations entering a final phase and a potential announcement expected soon [1][4]. Group 1: Deal Details - A potential deal to acquire Versace, currently owned by Capri Holdings, could be announced on Thursday, with the price possibly reduced to 1 billion euros ($1.1 billion), which is one-third lower than initial estimates [2]. - Capri Holdings' CEO John Idol is expected to visit Milan to discuss the deal, indicating active engagement in the negotiations [3]. - Prada had exclusive access to Versace's financial data for four weeks starting in late February, which has since been extended, suggesting thorough due diligence [3]. Group 2: Company Background - Versace was acquired by Capri Holdings for 1.8 billion euros in 2018 but has been operating at a loss recently [6]. - Donatella Versace recently stepped down as chief creative officer, with Dario Vitale, a former Miu Miu designer, taking over the role [6].

Core Viewpoint - Capri Holdings reported disappointing Q3 fiscal 2025 results, with both revenue and earnings declining year over year, although total revenues exceeded consensus estimates while earnings fell short [2][3]. Financial Performance - Adjusted quarterly earnings were 45 cents per share, down from $1.20 in the same period last year, and below the Zacks Consensus Estimate of 63 cents per share [3]. - Total revenues reached $1,261 million, surpassing the Zacks Consensus Estimate of $1,248 million, but decreased by 11.6% year over year on a reported basis and 11.4% on a constant-currency basis [4]. - Gross profit fell 12.5% year over year to $812 million, with gross margin contracting by 60 basis points to 64.4% due to lower full-price sell-throughs [4]. Segment Performance - Versace's revenues declined 15% year over year to $193 million, with retail sales dropping in the mid-teens and wholesale revenues declining in double digits [6]. - Jimmy Choo's revenues were $159 million, marking a 4.2% decrease, with retail sales stable and wholesale revenues down in the mid-teens [7]. - Michael Kors reported revenues of $909 million, a decrease of 12.1%, with retail sales declining in the low teens and wholesale revenues falling in the high-single digits [8]. Financial Health - The company ended the quarter with cash and cash equivalents of $356 million, long-term debt of $1.45 billion, and total shareholders' equity of $1.07 billion [9]. - Operating cash flow for the fiscal third quarter was $309 million, while free cash flow totaled $278 million [9]. Future Outlook - For fiscal 2025, Capri Holdings expects total revenues of $4.4 billion, with adjusted operating income projected at $100 million [10]. - For fiscal 2026, total revenues are anticipated to be $4.1 billion, with adjusted operating income expected to reach $150 million [12]. Estimate Trends - Recent estimates have trended downward, with the consensus estimate shifting by -178.05% [14]. - The stock currently holds a Zacks Rank 4 (Sell), indicating expectations of below-average returns in the coming months [16].

Core Viewpoint - Capri Holdings Ltd.'s stock increased by 7.8% following reports of a potential sale of its Versace brand to Prada SpA for 1.5 billion euros [1] Group 1: Company Details - The deal for Versace is valued at 1.5 billion euros, as reported by Bloomberg [1] - Versace was founded in 1878 by Gianni Versace and is currently managed by his sister, Donatella Versace [1] Group 2: Market Reaction - Capri Holdings Ltd.'s stock experienced a significant rise of 7.8% early Monday due to the news of the potential sale [1]

Core Viewpoint - A class action lawsuit has been filed against Capri Holdings Limited, alleging that the company made false and misleading statements regarding the accessible luxury handbag market during the class period from August 10, 2023, to October 24, 2024 [1][3]. Group 1: Allegations in the Lawsuit - The lawsuit claims that the accessible luxury handbag market is a distinct segment within the overall handbag industry, known to executives at Capri and Tapestry, Inc. [3] - It is alleged that Capri and Tapestry maintained separate production facilities and supply chains for their accessible luxury handbags, confirming the distinct nature of this market [3]. - The lawsuit states that Capri and Tapestry viewed Coach and Michael Kors as their closest competitors, while not considering their brands to be in direct competition with luxury or mass-market handbags [3]. - A primary reason for Tapestry's failed acquisition attempt of Capri was to consolidate brands in the accessible luxury handbag market to reduce competition and improve profit margins [3]. - The likelihood of adverse regulatory actions regarding the Capri Acquisition was reportedly higher than what the defendants had disclosed [3]. Group 2: Investor Information - Investors have until February 21, 2025, to file a lead plaintiff motion in the class action lawsuit [1]. - The Portnoy Law Firm offers complimentary case evaluations for investors seeking to recover losses related to the alleged corporate wrongdoing [2][4].

Core Viewpoint - Faruqi & Faruqi, LLP is investigating potential claims against Capri Holdings Limited due to allegations of violations of federal securities laws, particularly concerning misleading statements about the accessible luxury handbag market and the implications of the Capri acquisition [2][4]. Group 1: Legal Proceedings and Allegations - The complaint alleges that Capri and its executives made false and misleading statements regarding the distinct nature of the accessible luxury handbag market and its competition with other market segments [4]. - The lawsuit claims that the internal rationale for the Capri acquisition was to consolidate brands within the accessible luxury handbag market, thereby reducing competition and increasing prices [4]. - Following a court ruling on October 24, 2024, the U.S. Federal Trade Commission's motion to preliminarily enjoin the Capri acquisition was granted, leading to a nearly 50% drop in Capri's stock price [5]. Group 2: Investor Information and Actions - Investors who suffered losses exceeding $50,000 in Capri between August 10, 2023, and October 24, 2024, are encouraged to contact Faruqi & Faruqi to discuss their legal rights [1]. - The deadline for investors to seek the role of lead plaintiff in the federal securities class action against Capri is February 21, 2025 [2]. - The firm is also seeking information from whistleblowers, former employees, and shareholders regarding Capri's conduct [7].

Core Viewpoint - The Gross Law Firm has issued a notice to shareholders of Capri Holdings Limited regarding a class action lawsuit alleging misleading statements and omissions related to the accessible luxury handbag market and the acquisition by Tapestry [1][2]. Group 1: Allegations - The complaint claims that during the class period from August 10, 2023, to October 24, 2024, defendants made materially false and misleading statements about the accessible luxury handbag market being distinct from other markets [2]. - It is alleged that Capri and Tapestry maintained separate production facilities and supply chains for accessible luxury handbags, confirming the market's distinct nature [2]. - The complaint states that Capri and Tapestry viewed Coach and Michael Kors as direct competitors, while not considering their brands in direct competition with luxury or mass market handbags [2]. - A key internal rationale for the acquisition of Capri by Tapestry was to consolidate brands within the accessible luxury handbag market to reduce competition and increase prices [2]. - The risk of regulatory actions or the acquisition being blocked was reportedly higher than what was represented by the defendants [2]. Group 2: Next Steps for Shareholders - Shareholders who purchased shares of Capri during the specified timeframe are encouraged to register for the class action by February 21, 2025, to potentially become lead plaintiffs [3]. - Registered shareholders will receive updates through a portfolio monitoring software throughout the case lifecycle [3]. Group 3: Law Firm Background - The Gross Law Firm is a nationally recognized class action law firm dedicated to protecting investors' rights against deceit and illegal business practices [4]. - The firm aims to ensure companies adhere to responsible business practices and seeks recovery for investors who suffered losses due to misleading statements [4].

Group 1 - A securities class action lawsuit has been filed against Capri Holdings Limited on behalf of purchasers of Capri securities from August 10, 2023, to October 24, 2024 [1][2] - Capri is a UK-based company that owns several fashion brands, including Michael Kors, which specializes in handbags and accessories [2] - On August 10, 2023, Capri and Tapestry announced a merger agreement where Tapestry would acquire Capri for $57 per share in cash, combining their brands in the accessible luxury market [3] Group 2 - The class action lawsuit alleges that the defendants failed to disclose that the primary reason for the acquisition was to consolidate brands to reduce competition, increase prices, and improve profit margins [4] - On October 24, 2024, a U.S. District Court granted a motion to preliminarily enjoin the Capri acquisition, citing evidence that the brands were direct competitors in the accessible luxury handbag market [5] - Following the court's decision, Capri's share price dropped from $41.60 to $21.26, a decline of nearly 50% [5]

Core Viewpoint - A class action securities lawsuit has been filed against Capri Holdings Limited, alleging securities fraud that affected investors between August 10, 2023, and October 24, 2024 [1]. Group 1: Lawsuit Details - The lawsuit claims that Capri Holdings and Tapestry made false statements regarding the accessible luxury handbag market, asserting it is a distinct market within the overall handbag market [1]. - It is alleged that Capri and Tapestry maintained separate production facilities and supply chains for their accessible luxury handbags, differentiating them from luxury and mass market handbags [1]. - The complaint states that Capri and Tapestry viewed Coach and Michael Kors as their closest competitors, while not considering their brands in direct competition with luxury or mass market handbags [1]. - The lawsuit argues that a primary reason for the acquisition of Capri by Tapestry was to consolidate brands within the accessible luxury handbag market, aiming to reduce competition and increase prices [1]. - As a result of these actions, the risk of regulatory actions or the acquisition being blocked was higher than what was represented by the defendants [1]. Group 2: Next Steps for Investors - Investors who suffered losses in Capri Holdings during the specified timeframe have until February 21, 2025, to request to be appointed as lead plaintiff [2]. - Class members may be entitled to compensation without any out-of-pocket costs or fees, and participation does not require serving as a lead plaintiff [2]. Group 3: Firm Background - Levi & Korsinsky has a history of securing hundreds of millions of dollars for shareholders and has extensive expertise in complex securities litigation [3]. - The firm has been recognized in ISS Securities Class Action Services' Top 50 Report for seven consecutive years as one of the top securities litigation firms in the United States [3].

Core Insights - Capri Holdings' international operations are crucial for assessing its financial strength and growth potential, especially given its global presence [1][2][3] Group 1: Financial Performance - For the quarter ending December 2024, Capri Holdings reported total revenue of $1.26 billion, a decline of 11.6% year over year [4] - EMEA contributed $341 million, accounting for 27.04% of total revenue, with a surprise increase of +4.54% compared to expectations [5] - Asia generated $166 million, representing 13.16% of total revenue, with a slight surprise of +0.55% over consensus estimates [6] Group 2: Revenue Forecasts - Analysts predict Capri Holdings will report $1 billion in total revenue for the current fiscal quarter, reflecting an 18% decline from the previous year [7] - For the full year, total revenue is expected to be $4.38 billion, down 15.2% from the previous year, with EMEA and Asia projected to contribute 29.2% ($1.28 billion) and 15.2% ($667.73 million) respectively [8] Group 3: Market Trends and Stock Performance - The reliance on international markets presents both opportunities and challenges for Capri Holdings, making it essential to monitor international revenue trends for future projections [9] - Over the past month, Capri Holdings' stock has decreased by 7.6%, while the Zacks S&P 500 composite increased by 4.2% [13]