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V.F. Corp to Sell Nautica Brand, Growth Strategy on Track
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V.F. Corporation (VFC - Free Report) has agreed to sell its iconic Nautica brand to Authentic Brands Group, LLC, a leading brand development and entertainment company based in New York. The deal, likely to close in the first half of 2018, is in sync with V.F. Corp’s global business strategy. Notably, this strategy focuses on rapidly changing marketplace while targeting huge shareholder returns. However, financial terms of the deal remained under covers.
Meanwhile, V.F. Corp has been smoothly progressing with its five-year strategic growth plan, alias, 2021 growth strategy. Under the plan, the company’s four-point strategy is focused on redesigning portfolio and empowering its key brands, adopting a consumer and retail-centric model, enriching direct-to-consumer and digital businesses, and directing investment to Asia, particularly China.
Further, these plans will be aided by increased investments in design and innovation, demand creation and brand experience, insights and analytics, retail excellence, demand and supply chain agility, and talent. In fact, this growth strategy aims at generating cumulative operating cash flows in excess of $9 billion in the five-year period between 2017 and 2021, and returning about $8 billion to shareholders in the form of dividends and share repurchases. Further, it anticipates five-year compounded annual revenue growth rate (CAGR) of 5-7% through 2021 backed by strong performance of the Vans, the North Face and the Timberland brands (big three brands), along with gains from international and direct-to-consumer businesses. In 2021,earnings per share growth is expected to reach 11-13% at a five-year CAGR.
However, V.F. Corp stock lost 1.8% on Mar 19, following the divestiture agreement. Nevertheless, in the past six months, this Zacks Rank #3 (Hold) company’s shares have rallied 19.9% compared with the industry’s gain of 14.3%.
V.F. Corp has also been aggressively taking actions in regard to reshaping its business portfolio and drive growth across all categories. Of late, management unveiled plans to buy the Altra footwear brand from ICON Health & Fitness, Inc. This deal is likely to close in April and should be accretive to V.F. Corp’s earnings thereafter. It is likely to boost growth across the company’s direct-to-consumer and international channels as well.
Want Top-Ranked Stocks in the Same Industry? Count on These
Columbia Sportswear Company (COLM - Free Report) , also a Zacks Rank #1 stock, pulled off an average positive earnings surprise of 16.5% in the last four quarters.
Michael Kors Holdings Limited has outpaced the earnings estimates in each of the trailing four quarters by an average of 32.7%. The company sports a Zacks Rank of 1.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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V.F. Corp to Sell Nautica Brand, Growth Strategy on Track
V.F. Corporation (VFC - Free Report) has agreed to sell its iconic Nautica brand to Authentic Brands Group, LLC, a leading brand development and entertainment company based in New York. The deal, likely to close in the first half of 2018, is in sync with V.F. Corp’s global business strategy. Notably, this strategy focuses on rapidly changing marketplace while targeting huge shareholder returns. However, financial terms of the deal remained under covers.
Meanwhile, V.F. Corp has been smoothly progressing with its five-year strategic growth plan, alias, 2021 growth strategy. Under the plan, the company’s four-point strategy is focused on redesigning portfolio and empowering its key brands, adopting a consumer and retail-centric model, enriching direct-to-consumer and digital businesses, and directing investment to Asia, particularly China.
Further, these plans will be aided by increased investments in design and innovation, demand creation and brand experience, insights and analytics, retail excellence, demand and supply chain agility, and talent. In fact, this growth strategy aims at generating cumulative operating cash flows in excess of $9 billion in the five-year period between 2017 and 2021, and returning about $8 billion to shareholders in the form of dividends and share repurchases. Further, it anticipates five-year compounded annual revenue growth rate (CAGR) of 5-7% through 2021 backed by strong performance of the Vans, the North Face and the Timberland brands (big three brands), along with gains from international and direct-to-consumer businesses. In 2021,earnings per share growth is expected to reach 11-13% at a five-year CAGR.
However, V.F. Corp stock lost 1.8% on Mar 19, following the divestiture agreement. Nevertheless, in the past six months, this Zacks Rank #3 (Hold) company’s shares have rallied 19.9% compared with the industry’s gain of 14.3%.
V.F. Corp has also been aggressively taking actions in regard to reshaping its business portfolio and drive growth across all categories. Of late, management unveiled plans to buy the Altra footwear brand from ICON Health & Fitness, Inc. This deal is likely to close in April and should be accretive to V.F. Corp’s earnings thereafter. It is likely to boost growth across the company’s direct-to-consumer and international channels as well.
Want Top-Ranked Stocks in the Same Industry? Count on These
Delta Apparel, Inc. (DLA - Free Report) has a long-term earnings growth rate of 15% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Columbia Sportswear Company (COLM - Free Report) , also a Zacks Rank #1 stock, pulled off an average positive earnings surprise of 16.5% in the last four quarters.
Michael Kors Holdings Limited has outpaced the earnings estimates in each of the trailing four quarters by an average of 32.7%. The company sports a Zacks Rank of 1.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>