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TPR Stock Trades 17% Below 52-Week High: An Opportunity for Investors?
TPRTapestry(TPR) ZACKS·2025-03-25 11:40

Core Insights - Tapestry, Inc. (TPR) shares are currently trading 16.7% below their 52-week high, but the stock has gained 66.7% over the past year, outperforming the Zacks Retail-Apparel and Shoes industry's decline of 6.8% [1] - The company has shown enhanced operational efficiency and growth initiatives, leading to better performance compared to the broader Retail-Wholesale sector and the S&P 500 index [1] Stock Performance - TPR closed at 75.72,tradingaboveits100−dayand200−daymovingaveragesof75.72, trading above its 100-day and 200-day moving averages of 68.09 and 55.17,indicatingapositivemarketsentiment[4]−Thestock′stechnicalstrengthsuggestssustainedmomentumandinvestorconfidenceinTapestry′sfinancialhealth[4]BrandPerformance−Coachbrandisakeygrowthdriver,achievingan1155.17, indicating a positive market sentiment [4] - The stock's technical strength suggests sustained momentum and investor confidence in Tapestry's financial health [4] Brand Performance - Coach brand is a key growth driver, achieving an 11% year-over-year revenue increase in Q2 fiscal 2025, along with a 270-basis-point improvement in gross margin [7] - Tapestry announced the sale of its Stuart Weitzman brand for 105 million, allowing a focus on core brands like Coach and Kate Spade [8] Global Expansion - Tapestry's international strategy has led to significant revenue gains, particularly in Europe, which saw a 42% year-over-year revenue increase in Q2 [10] - Greater China returned to revenue growth with a 2% year-over-year rise, while the broader Asia-Pacific region (excluding China) experienced 11% growth [11] Digital and Direct-to-Consumer Strategies - DTC sales increased by 4% in Q2, driven by high-single-digit growth in digital sales [12] - AI-powered customer engagement has improved pricing strategies and attracted younger consumers, enhancing competitive positioning [13] Financial Outlook - Tapestry raised its FY25 revenue outlook to exceed 6.85billion,reflectinga36.85 billion, reflecting a 3% year-over-year increase [14] - Projected EPS is now between 4.85 and 4.90,indicatinga13−144.90, indicating a 13-14% increase from the prior year [15] Valuation - Tapestry is trading at a low forward P/E ratio of 14.57, below industry and sector averages, highlighting its potential as an attractive investment [16] - The company has a Value Score of A, indicating strong appeal for investors [16] Analyst Estimates - Analysts have positively revised Tapestry's EPS estimates, with the current fiscal year consensus at 4.91 per share, reflecting a year-over-year growth of 14.5% [19] - The sales estimates for the current and next fiscal years are pegged at 6.87billionand6.87 billion and 7.11 billion, implying growth of 3% and 3.4%, respectively [20] Investment Appeal - Tapestry is viewed as a compelling investment opportunity due to its digital strategies, strong brand performance, and strategic international expansion [22] - The company currently holds a Zacks Rank 2 (Buy), indicating favorable market conditions for investment [22]