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Tapestry (TPR) Gains Market Share on Operational Strength

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Tapestry, Inc. (TPR - Free Report) , one of the widely recognized names in the Retail - Apparel And Shoes industry, has been making tactical changes to its business operations to adapt and stay relevant in the competitive retail landscape. Its consumer-centric approach, omni-channel capabilities, brand awareness and emphasis on high-growth areas position it well among peers.

The company’s Acceleration Program has been a major contributing factor. The program is aimed at transforming the company into a leaner and more responsive organization. It intends to build significant data and analytics capabilities with a focus on enhancing digital and omni-channel capabilities and operating with a clearly defined path and strategy for each of its brands, namely Coach, Kate Spade and Stuart Weitzman.

This New York-based company continued with its sturdy e-commerce performance during third-quarter fiscal 2022, with digital sales rising more than 20% compared with the prior-year period and representing about 30% of total business. The company witnessed a digital sales increase of 25% at Coach and mid-teens growth at Kate Spade. Turning to Stuart Weitzman, the company continued to make strategic investments, including digital, which accounted for 20% of global sales.

 

Zacks Investment Research
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North America has been one of the key contributors to Tapestry’s upbeat performance. During the third quarter of fiscal 2002, the company added more than 1.4 million new customers across channels in North America, representing mid-teens increase compared with the prior year. Sales in North America surged 22% year over year, courtesy of increasing consumer demand across all brands.

Shares of this Zacks Rank #3 (Hold) company have fallen 13.2% in the past three months compared with the industry’s decline of 20.4%.

Wrapping Up

Tapestry’s long-term growth drivers include deepening engagement with consumers, creating innovative and compelling products, venturing into under-penetrated markets and enhancement of digital capacities.

The company envisions revenues to be approximately $6.7 billion for fiscal 2022. This suggests a high-teens growth rate versus the prior year on a 52-week, comparable basis with double-digit increases in each brand. The company guided earnings in the area of $3.45 per share, which indicates an increase from adjusted earnings of $2.97 per share reported in fiscal 2021. For the fourth quarter, Tapestry foresees continued strength in North America and Europe with steady growth in the rest of Asia.

Pick These 3 Stocks

Here we have highlighted three better-ranked stocks, namely, Steven Madden (SHOO - Free Report) , Boot Barn Holdings (BOOT - Free Report) and G-III Apparel (GIII - Free Report) .

Steven Madden is a leading designer and marketer of fashion-forward footwear, accessories and apparel for women, men and children. The stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Steven Madden’s current financial year revenues and EPS suggests growth of 15% and 19.2%, respectively, from the year-ago reported figure. SHOO has a trailing four-quarter earnings surprise of 44%, on average.

Boot Barn Holdings, a lifestyle retailer of western and work-related footwear, apparel and accessories, flaunts a Zacks Rank #1. BOOT has an expected EPS growth rate of 20% for three-five years.

The Zacks Consensus Estimate for Boot Barn Holdings’ current financial year sales and EPS suggests growth of 17% and 4.4%, respectively, from the year-ago period.

G-III Apparel designs, sources and markets apparel and accessories under owned, licensed and private label brands. The stock currently carries a Zacks Rank #2 (Buy).

The Zacks Consensus Estimate for G-III Apparel’s current financial year revenues and EPS suggests growth of 12.9% and 10.4%, respectively, from the year-ago reported figure. G-III Apparel has a trailing four-quarter earnings surprise of 97.5%, on average.