On Tuesday, shares of luxury retailer Michael Kors are tumbling, down almost 6% in morning trading after MKM Partners initiated coverage on the company.
The firm gave Michael Kors, known for its handbags and other leather goods, a “Sell” rating and a $26 price target, which represents a potential downside of 27% from the stock’s previous closing price.
Specifically, analyst Roxanne Meyer is not convinced Michael Kors would meet Wall Street estimates for 2018 or 2019 following its weak fourth quarter earnings results. She also pointed out that Kors’ EBITDA growth is one of the lowest ranking among the companies she covers.
"Our below Street estimates reflect downside to comps and margins, in light of a slow infusion of innovation, changes to the merchandising and promotional strategy, over-exposure to wholesale, as well as our view that the operating margin is structurally headed lower from the shift to retail, investments in omni-channel, and product mix shift to lower margin categories," she wrote in a note to clients.
KORS currently holds a #4 (Strong Sell) on the Zacks Rank, with a VGM score of ‘B.’ Shares of Michael Kors have fallen over 16.5% year-to-date, and almost 30% in the past 12 months.
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Did you miss Apple's 9x stock explosion after they launched their iPhone in 2007? Now, 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade, which could, in turn, save $200 billion in U.S. healthcare costs.
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Why is Michael Kors (KORS) Stock Tumbling Today?
On Tuesday, shares of luxury retailer Michael Kors are tumbling, down almost 6% in morning trading after MKM Partners initiated coverage on the company.
The firm gave Michael Kors, known for its handbags and other leather goods, a “Sell” rating and a $26 price target, which represents a potential downside of 27% from the stock’s previous closing price.
Specifically, analyst Roxanne Meyer is not convinced Michael Kors would meet Wall Street estimates for 2018 or 2019 following its weak fourth quarter earnings results. She also pointed out that Kors’ EBITDA growth is one of the lowest ranking among the companies she covers.
"Our below Street estimates reflect downside to comps and margins, in light of a slow infusion of innovation, changes to the merchandising and promotional strategy, over-exposure to wholesale, as well as our view that the operating margin is structurally headed lower from the shift to retail, investments in omni-channel, and product mix shift to lower margin categories," she wrote in a note to clients.
KORS currently holds a #4 (Strong Sell) on the Zacks Rank, with a VGM score of ‘B.’ Shares of Michael Kors have fallen over 16.5% year-to-date, and almost 30% in the past 12 months.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9x stock explosion after they launched their iPhone in 2007? Now, 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade, which could, in turn, save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>