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Why Is V.F. (VFC) Down 8.8% Since Last Earnings Report?
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It has been about a month since the last earnings report for V.F. (VFC - Free Report) . Shares have lost about 8.8% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is V.F. due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for V.F. Corporation before we dive into how investors and analysts have reacted as of late.
V.F. Corp. Q1 Earnings Miss Estimates as Vans Wholesale Weighs
V.F. Corporation posted first-quarter fiscal 2027 results, wherein the top and bottom lines missed the Zacks Consensus Estimate and declined year over year.
The company reported an adjusted loss of 27 cents per share for first-quarter fiscal 2027, wider than the year-ago loss of 25 cents. The figure also lagged the Zacks Consensus Estimate of a 22-cent loss.
Revenues declined 5.2% year over year to $1.669 billion and missed the consensus mark of $1.674 billion. Excluding Dickies, revenues rose 1% on a reported basis, supported by growth at The North Face, Timberland and Altra.
V.F. Corp.’s Q1 Revenue Details
On a regional basis, revenues in the Americas declined 4% year over year on a reported basis. EMEA revenues fell 7% as reported and 9% in constant currency. APAC revenues decreased 3% on a reported basis and 6% in constant currency. Overall, international revenues declined 4% year over year as reported and 7% in constant currency.
By channel, wholesale revenues fell 10% on a reported basis. Direct-to-consumer revenues were up 2% year over year on a reported basis and 1% on a constant-currency basis.
Revenues in the Outdoor segment improved 5% year over year on a reported basis (up 4% on a constant-currency basis) to $857 million. In the Active segment, revenues of $667 million declined 5% year over year on a reported basis and 6% on a constant-currency basis. Revenues in the All Other segment fell 42% year over year on a reported basis (down 42% on a constant-currency basis) to $145 million.
VF Corp.’s Gross Margin Expands
The company’s reported gross margin increased 100 basis points year over year to 54.9%. Adjusted gross margin excluding Dickies improved 10 basis points to 54.9%, indicating modest underlying progress after removing the divested brand’s prior-year contribution.
Reported selling, general and administrative expenses were $1 billion, representing 59.9% of revenues. Adjusted expenses were $1.012 billion, or 60.6% of revenues.
Financial Details of VFC
V.F. Corp. ended the fiscal first quarter with cash and cash equivalents of $670 million, long-term debt of $3 billion and shareholders’ equity of $1.76 billion. Net debt was down $1.1 billion from the year-ago period.
What to Expect From VFC in FY27?
VFC raised its fiscal 2027 revenue outlook to growth of 2% or better in constant currency from the prior guidance of 1-2%. The projection reflects expected growth at The North Face, Timberland and Altra, partly offset by a mid-single-digit decline at Vans, with Vans’ second-half revenues expected to improve to a decline of 2% or better year over year.
The company maintained its adjusted operating margin forecast of approximately 8%, supported by a higher adjusted gross margin and a lower adjusted SG&A rate. Free cash flow is still expected to be flat to higher than fiscal 2026’s $405 million, aided by year-over-year growth in operating cash flow. VFC anticipates ending fiscal 2027 with a leverage ratio of roughly 2.6x to 2.9x.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -6.54% due to these changes.
VGM Scores
At this time, V.F. has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, V.F. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is V.F. (VFC) Down 8.8% Since Last Earnings Report?
It has been about a month since the last earnings report for V.F. (VFC - Free Report) . Shares have lost about 8.8% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is V.F. due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for V.F. Corporation before we dive into how investors and analysts have reacted as of late.
V.F. Corp. Q1 Earnings Miss Estimates as Vans Wholesale Weighs
V.F. Corporation posted first-quarter fiscal 2027 results, wherein the top and bottom lines missed the Zacks Consensus Estimate and declined year over year.
The company reported an adjusted loss of 27 cents per share for first-quarter fiscal 2027, wider than the year-ago loss of 25 cents. The figure also lagged the Zacks Consensus Estimate of a 22-cent loss.
Revenues declined 5.2% year over year to $1.669 billion and missed the consensus mark of $1.674 billion. Excluding Dickies, revenues rose 1% on a reported basis, supported by growth at The North Face, Timberland and Altra.
V.F. Corp.’s Q1 Revenue Details
On a regional basis, revenues in the Americas declined 4% year over year on a reported basis. EMEA revenues fell 7% as reported and 9% in constant currency. APAC revenues decreased 3% on a reported basis and 6% in constant currency. Overall, international revenues declined 4% year over year as reported and 7% in constant currency.
By channel, wholesale revenues fell 10% on a reported basis. Direct-to-consumer revenues were up 2% year over year on a reported basis and 1% on a constant-currency basis.
Revenues in the Outdoor segment improved 5% year over year on a reported basis (up 4% on a constant-currency basis) to $857 million. In the Active segment, revenues of $667 million declined 5% year over year on a reported basis and 6% on a constant-currency basis. Revenues in the All Other segment fell 42% year over year on a reported basis (down 42% on a constant-currency basis) to $145 million.
VF Corp.’s Gross Margin Expands
The company’s reported gross margin increased 100 basis points year over year to 54.9%. Adjusted gross margin excluding Dickies improved 10 basis points to 54.9%, indicating modest underlying progress after removing the divested brand’s prior-year contribution.
Reported selling, general and administrative expenses were $1 billion, representing 59.9% of revenues. Adjusted expenses were $1.012 billion, or 60.6% of revenues.
Financial Details of VFC
V.F. Corp. ended the fiscal first quarter with cash and cash equivalents of $670 million, long-term debt of $3 billion and shareholders’ equity of $1.76 billion. Net debt was down $1.1 billion from the year-ago period.
What to Expect From VFC in FY27?
VFC raised its fiscal 2027 revenue outlook to growth of 2% or better in constant currency from the prior guidance of 1-2%. The projection reflects expected growth at The North Face, Timberland and Altra, partly offset by a mid-single-digit decline at Vans, with Vans’ second-half revenues expected to improve to a decline of 2% or better year over year.
The company maintained its adjusted operating margin forecast of approximately 8%, supported by a higher adjusted gross margin and a lower adjusted SG&A rate. Free cash flow is still expected to be flat to higher than fiscal 2026’s $405 million, aided by year-over-year growth in operating cash flow. VFC anticipates ending fiscal 2027 with a leverage ratio of roughly 2.6x to 2.9x.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -6.54% due to these changes.
VGM Scores
At this time, V.F. has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, V.F. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.