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Why Kontoor Brands Is Betting Big on Wrangler and Helly Hansen?
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Key Takeaways
KTB pursues a Lee sale to sharpen focus on Wrangler and Helly Hansen growth.
Wrangler posts 16 straight quarters of bottoms market share gains and DTC growth.
Helly Hansen expands U.S. investments across retail, apparel and workwear categories.
Kontoor Brands, Inc. (KTB - Free Report) stated that its decision to initiate a sales process for the Lee business reflects management’s confidence in the long-term opportunities within the Wrangler and Helly Hansen brands. Management emphasized that maintaining strategic focus remains central to the company’s approach, and concentrating resources and capital on growth-oriented brands is expected to help accelerate long-term growth and profitability. The move is also expected to provide greater flexibility in future capital allocation decisions.
Wrangler brand is a cornerstone of consistency, having achieved 16 consecutive quarters of market share gains in bottoms with low single-digit growth over the past three years, with fiscal 2025 marking one of the brand’s strongest performances. Growth has been supported by market share gains in core bottoms and double-digit expansion across female, Western and direct-to-consumer channels. Looking ahead, the company plans to accelerate investments in women’s denim, non-denim categories and digital capabilities, including AI and loyalty initiatives, to support long-term growth.
Helly Hansen continues to represent a significant global growth opportunity, with management expecting the brand to become a larger contributor to future revenue and profitability. The brand remains significantly underpenetrated in the United States. The company plans to accelerate investments across geographic expansion, product development, digital capabilities, retail growth and brand awareness initiatives. Additional focus is being placed on technical outdoor apparel, footwear, along with expanding workwear opportunities.
Overall, by sharpening focus on Wrangler and Helly Hansen, Kontoor Brands aims to accelerate growth, expand margins, strengthen brand positioning and unlock greater long-term value through disciplined investments and strategic capital allocation.
The Zacks Rundown for KTB
Shares of KTB have lost 5.6% in the past three months compared with the industry’s decline of 16.6%.
Image Source: Zacks Investment Research
From a valuation standpoint, KTB trades at a forward price-to-earnings ratio of 9.42X, lower than the industry’s average of 16.40X. KTB currently carries a Zacks Rank #4 (Sell).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for KTB’s current fiscal year earnings has been revised downward to $5.20 per share from $6.46 per share, while the same for the next fiscal year earnings has been revised downward to $5.79 per share from $6.95 per share.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
Vince Holding Corp. (VNCE - Free Report) provides luxury apparel and accessories in the United States and internationally. It operates through Vince Wholesale and Vince Direct-to-Consumer segments. At present, the company flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for VNCE’s current fiscal-year sales implies growth of 4.5%, and the same for earnings implies a decline of 15.9% from the year-ago figures. VNCE has delivered a trailing four-quarter earnings surprise of 647.2%, on average.
Columbia Sportswear Company (COLM - Free Report) engages in the design, development, marketing, and distribution of outdoor, active, and lifestyle products in the United States, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and Canada. At present, COLM flaunts a Zacks Rank of 1.
The Zacks Consensus Estimate for COLM’s current fiscal-year sales implies growth of 2.4%, and the same for earnings indicates a decline of 0.8% from the year-ago figures. COLM delivered a trailing four-quarter earnings surprise of 44.1%, on average.
V.F. Corporation ((VFC - Free Report) offers branded apparel, footwear, and accessories for men, women, and children in the Americas, Europe, and the Asia-Pacific. At present, VFC currently sports a Zacks Rank of 1.
The Zacks Consensus Estimate for VFC’s current fiscal-year sales implies a decline of 3.2%, and the same for earnings implies a growth of 10.8%, respectively, from the year-ago figures. VFC delivered a trailing four-quarter negative earnings surprise of 25.9%, on average.
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Why Kontoor Brands Is Betting Big on Wrangler and Helly Hansen?
Key Takeaways
Kontoor Brands, Inc. (KTB - Free Report) stated that its decision to initiate a sales process for the Lee business reflects management’s confidence in the long-term opportunities within the Wrangler and Helly Hansen brands. Management emphasized that maintaining strategic focus remains central to the company’s approach, and concentrating resources and capital on growth-oriented brands is expected to help accelerate long-term growth and profitability. The move is also expected to provide greater flexibility in future capital allocation decisions.
Wrangler brand is a cornerstone of consistency, having achieved 16 consecutive quarters of market share gains in bottoms with low single-digit growth over the past three years, with fiscal 2025 marking one of the brand’s strongest performances. Growth has been supported by market share gains in core bottoms and double-digit expansion across female, Western and direct-to-consumer channels. Looking ahead, the company plans to accelerate investments in women’s denim, non-denim categories and digital capabilities, including AI and loyalty initiatives, to support long-term growth.
Helly Hansen continues to represent a significant global growth opportunity, with management expecting the brand to become a larger contributor to future revenue and profitability. The brand remains significantly underpenetrated in the United States. The company plans to accelerate investments across geographic expansion, product development, digital capabilities, retail growth and brand awareness initiatives. Additional focus is being placed on technical outdoor apparel, footwear, along with expanding workwear opportunities.
Overall, by sharpening focus on Wrangler and Helly Hansen, Kontoor Brands aims to accelerate growth, expand margins, strengthen brand positioning and unlock greater long-term value through disciplined investments and strategic capital allocation.
The Zacks Rundown for KTB
Shares of KTB have lost 5.6% in the past three months compared with the industry’s decline of 16.6%.
Image Source: Zacks Investment Research
From a valuation standpoint, KTB trades at a forward price-to-earnings ratio of 9.42X, lower than the industry’s average of 16.40X. KTB currently carries a Zacks Rank #4 (Sell).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for KTB’s current fiscal year earnings has been revised downward to $5.20 per share from $6.46 per share, while the same for the next fiscal year earnings has been revised downward to $5.79 per share from $6.95 per share.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
Vince Holding Corp. (VNCE - Free Report) provides luxury apparel and accessories in the United States and internationally. It operates through Vince Wholesale and Vince Direct-to-Consumer segments. At present, the company flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for VNCE’s current fiscal-year sales implies growth of 4.5%, and the same for earnings implies a decline of 15.9% from the year-ago figures. VNCE has delivered a trailing four-quarter earnings surprise of 647.2%, on average.
Columbia Sportswear Company (COLM - Free Report) engages in the design, development, marketing, and distribution of outdoor, active, and lifestyle products in the United States, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and Canada. At present, COLM flaunts a Zacks Rank of 1.
The Zacks Consensus Estimate for COLM’s current fiscal-year sales implies growth of 2.4%, and the same for earnings indicates a decline of 0.8% from the year-ago figures. COLM delivered a trailing four-quarter earnings surprise of 44.1%, on average.
V.F. Corporation ((VFC - Free Report) offers branded apparel, footwear, and accessories for men, women, and children in the Americas, Europe, and the Asia-Pacific. At present, VFC currently sports a Zacks Rank of 1.
The Zacks Consensus Estimate for VFC’s current fiscal-year sales implies a decline of 3.2%, and the same for earnings implies a growth of 10.8%, respectively, from the year-ago figures. VFC delivered a trailing four-quarter negative earnings surprise of 25.9%, on average.