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Tapestry Hits a New 52-Week High: Is It Time to Buy Into the Rally?
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Key Takeaways
Coach posted a record 79% gross margin, led by premium leather goods and footwear innovation.
Coach added 900K new North American customers, nearly 70% from Gen Z and Millennials.
Fiscal 2025 is guided to $6.95B sales and EPS of $5, with an operating margin expansion forecast.
Tapestry, Inc.’s (TPR - Free Report) shares reached a new 52-week high of $102.31 yesterday before closing at $102.16. So far, TPR stock has risen 56.4% against the Zacks Retail-Apparel and Shoes industry’s sharp 12.3% decline.
The company’s diversified business model, combining iconic brands with an agile supply chain and omnichannel presence, positions it to outperform the broader Retail Wholesale sector and the S&P 500 index’s growth of 4% and 6%, respectively, during the same period.
Image Source: Zacks Investment Research
Moreover, Tapestry has shown solid upward momentum, currently trading above both its 50 and 200-day simple moving averages of $84.69 and $69.85, respectively, key indicators of price stability and long-term bullish trends. This technical strength, coupled with continued momentum, signals positive market sentiment and growing investor confidence in TPR's financial health and growth potential.
Tapestry continues to strengthen its leadership in the global affordable luxury market through focused brand strategies, strong customer engagement and operational excellence. The company’s ability to connect emotionally with younger consumers, deliver innovation in its products and expand internationally underscores the long-term growth potential.
A key driver of Tapestry’s growth continues to be the Coach brand, which posted a 15% year-over-year revenue increase at constant currency in the third quarter of fiscal 2025. Coach added more than 900,000 new customers in North America alone, with nearly 70% from Gen Z and Millennials.
Notably, Coach achieved a record 79% gross margin, fueled by premium leather goods, footwear innovation and its “One Coach” strategy aligning full-price and outlet channels. The brand’s popular Tabby and New York collections, as well as strong footwear momentum led by the Soho and Highline sneakers, contributed significantly to top-line and Average Unit Retail (“AUR”) growth.
International markets also provided meaningful tailwinds, with Europe’s revenues growing 35% at constant currency and Asia-Pacific rising 4%, including a 5% gain in Greater China. These gains reflect Tapestry’s ability to blend globally relevant product offerings with localized marketing and customer acquisition strategies. The omnichannel model remained a competitive advantage, with direct-to-consumer sales up 9%, including mid-teens digital growth and mid-single-digit gains in brick-and-mortar stores.
Tapestry’s supply-chain agility and disciplined capital allocation further strengthened its business. The company maintained a diversified manufacturing base outside China, limiting tariff exposure while protecting profitability. Tapestry also returned more than $2 billion to its shareholders through dividends and share repurchases in fiscal 2025, supported by strong free cash flow and a healthy balance sheet. Gross leverage was 1.6 times adjusted EBITDA, well below the stated target of under 2.5 times, underscoring the company’s financial flexibility to invest in growth and shareholder returns simultaneously.
What to Expect From Tapestry in the Future?
For fiscal 2025, Tapestry has raised its full-year guidance, reflecting confidence in its ability to sustain strong brand momentum and operational execution. The company now expects net sales to reach approximately $6.95 billion, representing about 4% year-over-year growth. Earnings per share are pinned at $5, indicating high-teens growth over the prior year and ahead of earlier expectations.
Regionally, sales are expected to grow 3-4% in North America, approximately 30% in Europe, achieve low-single-digit growth in Greater China and deliver high-single-digit gains in other parts of Asia. This regional outlook indicates Tapestry’s strong traction in underpenetrated markets, continued customer acquisition and effective localized strategies.
On profitability, the company anticipates operating margin expansion of about 100 basis points year over year, driven largely by gross margin improvements due to higher AUR and cost efficiencies. Free cash flow for fiscal 2025 is forecasted to be approximately $1.3 billion, supporting continued investments in store enhancements, digital infrastructure and supply-chain initiatives. Capital expenditures and cloud computing costs are expected to total around $160 million, with about half allocated to store-related projects and the balance focused on digital and IT capabilities.
Final Words on Tapestry Stock
Tapestry offers a compelling opportunity for investors, driven by strong brand leadership, strategic international growth and consistent execution that continues to resonate with younger, style-conscious consumers. Its sustained momentum, supported by innovation, supply-chain resilience and disciplined capital returns, indicates a solid foundation for further appreciation. With positive market sentiment and clear visibility into growth, TPR is well-positioned for long-term value creation, making it a stock to consider buying for exposure to a thriving affordable luxury business. It currently holds a Zacks Rank #2 (Buy).
Canada Goose is a global outerwear brand. GOOS is a designer, manufacturer, distributor and retailer of premium outerwear for men, women and children. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Canada Goose’s current fiscal-year earnings and sales indicates growth of 10% and 2.9%, respectively, from the year-ago actuals. Canada Goose delivered a trailing four-quarter average earnings surprise of 57.2%.
Stitch Fix delivers customized shipments of apparel, shoes and accessories for women, men and kids. It currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Stitch Fix’s current fiscal-year earnings implies growth of 71.7% from the year-ago actual. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
Boot Barn operates as a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories. It presently has a Zacks Rank of 2.
The Zacks Consensus Estimate for Boot Barn’s current fiscal-year earnings and sales indicates growth of 7.6% and 11.8%, respectively, from the year-ago actuals. BOOT delivered a trailing four-quarter average earnings surprise of 3.4%.
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Tapestry Hits a New 52-Week High: Is It Time to Buy Into the Rally?
Key Takeaways
Tapestry, Inc.’s (TPR - Free Report) shares reached a new 52-week high of $102.31 yesterday before closing at $102.16. So far, TPR stock has risen 56.4% against the Zacks Retail-Apparel and Shoes industry’s sharp 12.3% decline.
The company’s diversified business model, combining iconic brands with an agile supply chain and omnichannel presence, positions it to outperform the broader Retail Wholesale sector and the S&P 500 index’s growth of 4% and 6%, respectively, during the same period.
Image Source: Zacks Investment Research
Moreover, Tapestry has shown solid upward momentum, currently trading above both its 50 and 200-day simple moving averages of $84.69 and $69.85, respectively, key indicators of price stability and long-term bullish trends. This technical strength, coupled with continued momentum, signals positive market sentiment and growing investor confidence in TPR's financial health and growth potential.
TPR Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
Growth Engines Behind Tapestry’s Market Leadership
Tapestry continues to strengthen its leadership in the global affordable luxury market through focused brand strategies, strong customer engagement and operational excellence. The company’s ability to connect emotionally with younger consumers, deliver innovation in its products and expand internationally underscores the long-term growth potential.
A key driver of Tapestry’s growth continues to be the Coach brand, which posted a 15% year-over-year revenue increase at constant currency in the third quarter of fiscal 2025. Coach added more than 900,000 new customers in North America alone, with nearly 70% from Gen Z and Millennials.
Notably, Coach achieved a record 79% gross margin, fueled by premium leather goods, footwear innovation and its “One Coach” strategy aligning full-price and outlet channels. The brand’s popular Tabby and New York collections, as well as strong footwear momentum led by the Soho and Highline sneakers, contributed significantly to top-line and Average Unit Retail (“AUR”) growth.
International markets also provided meaningful tailwinds, with Europe’s revenues growing 35% at constant currency and Asia-Pacific rising 4%, including a 5% gain in Greater China. These gains reflect Tapestry’s ability to blend globally relevant product offerings with localized marketing and customer acquisition strategies. The omnichannel model remained a competitive advantage, with direct-to-consumer sales up 9%, including mid-teens digital growth and mid-single-digit gains in brick-and-mortar stores.
Tapestry’s supply-chain agility and disciplined capital allocation further strengthened its business. The company maintained a diversified manufacturing base outside China, limiting tariff exposure while protecting profitability. Tapestry also returned more than $2 billion to its shareholders through dividends and share repurchases in fiscal 2025, supported by strong free cash flow and a healthy balance sheet. Gross leverage was 1.6 times adjusted EBITDA, well below the stated target of under 2.5 times, underscoring the company’s financial flexibility to invest in growth and shareholder returns simultaneously.
What to Expect From Tapestry in the Future?
For fiscal 2025, Tapestry has raised its full-year guidance, reflecting confidence in its ability to sustain strong brand momentum and operational execution. The company now expects net sales to reach approximately $6.95 billion, representing about 4% year-over-year growth. Earnings per share are pinned at $5, indicating high-teens growth over the prior year and ahead of earlier expectations.
Regionally, sales are expected to grow 3-4% in North America, approximately 30% in Europe, achieve low-single-digit growth in Greater China and deliver high-single-digit gains in other parts of Asia. This regional outlook indicates Tapestry’s strong traction in underpenetrated markets, continued customer acquisition and effective localized strategies.
On profitability, the company anticipates operating margin expansion of about 100 basis points year over year, driven largely by gross margin improvements due to higher AUR and cost efficiencies. Free cash flow for fiscal 2025 is forecasted to be approximately $1.3 billion, supporting continued investments in store enhancements, digital infrastructure and supply-chain initiatives. Capital expenditures and cloud computing costs are expected to total around $160 million, with about half allocated to store-related projects and the balance focused on digital and IT capabilities.
Final Words on Tapestry Stock
Tapestry offers a compelling opportunity for investors, driven by strong brand leadership, strategic international growth and consistent execution that continues to resonate with younger, style-conscious consumers. Its sustained momentum, supported by innovation, supply-chain resilience and disciplined capital returns, indicates a solid foundation for further appreciation. With positive market sentiment and clear visibility into growth, TPR is well-positioned for long-term value creation, making it a stock to consider buying for exposure to a thriving affordable luxury business. It currently holds a Zacks Rank #2 (Buy).
Other Stocks to Consider
Some other top-ranked stocks are Canada Goose (GOOS - Free Report) , Stitch Fix (SFIX - Free Report) and Boot Barn Holdings, Inc. (BOOT - Free Report) .
Canada Goose is a global outerwear brand. GOOS is a designer, manufacturer, distributor and retailer of premium outerwear for men, women and children. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Canada Goose’s current fiscal-year earnings and sales indicates growth of 10% and 2.9%, respectively, from the year-ago actuals. Canada Goose delivered a trailing four-quarter average earnings surprise of 57.2%.
Stitch Fix delivers customized shipments of apparel, shoes and accessories for women, men and kids. It currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for Stitch Fix’s current fiscal-year earnings implies growth of 71.7% from the year-ago actual. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
Boot Barn operates as a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories. It presently has a Zacks Rank of 2.
The Zacks Consensus Estimate for Boot Barn’s current fiscal-year earnings and sales indicates growth of 7.6% and 11.8%, respectively, from the year-ago actuals. BOOT delivered a trailing four-quarter average earnings surprise of 3.4%.