Sidelined And Cautious
Canaccord remains cautious on the accessory and footwear/apparel maker, following sluggishness in its
Analysts noted three major factors contributing to the cautious outlook:
- Challenging macro/industry headwinds both domestically and internationally.
- Uncertainty surrounding consumer response to reduced promotions in the wholesale business.
- A heavy reliance on secondary category growth initiatives, fragrance and men’s, international, to make up from a slowing core business.
Justification For Rating
A recent analyst note from Canaccord highlighting that upcoming brand repositioning will likely cause some significant pain next year before gain.
“Once KORS begins to implement its strategy to reduce promotions in the department store channel, we suspect the consumer response will not be favorable and result in steep comp declines,” wrote analyst Camilo Lyon.
Analysts believe declines in wholesale are likely to continue well into fiscal year 2018. Canaccord left their price target unchanged at $45 and maintains a Hold rating.
At last check, Michael Kors was flat on the day, off Tuesday's opening price of $50.25 by a nickel.
Image Credit: By Hoispenard (Own work) [CC BY-SA 3.0], via
Latest Ratings for KORS
|Oct 2016||OTR GLobal||Upgrades||Negative||Mixed|
|Sep 2016||Guggenheim||Initiates Coverage on||Neutral|
|Sep 2016||CLSA||Initiates Coverage on||Sell|