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Tapestry Hits a New 52-Week High: How Should You Play the Stock Now?
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Tapestry, Inc.’s (TPR - Free Report) shares reached a new 52-week high of $88.07 last Friday before closing at $87.70. So far, TPR stock has rallied 34.2% against the Zacks Retail-Apparel and Shoes industry’s sharp 5.7% decline.
The company’s ongoing operational efficiency and strategic efficiency have enabled it to outperform the broader Retail Wholesale sector and the S&P 500 index’s growth of 9.2% and 3.9%, respectively, during the same period.
TPR Stock Year-to-Date Performance
Image Source: Zacks Investment Research
Moreover, the company has shown solid upward momentum, currently trading above both its 50 and 200-day simple moving averages of $50.50 and $69.77, 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
TPR’s Strong Digital Channel & DTC Strength
Tapestry’s digital and direct-to-consumer (“DTC”) strategies continue to drive growth. The company saw solid gains in digital sales and improved profitability across all channels. In second-quarter fiscal 2025, the company achieved 4% growth in DTC sales, driven by a high-single-digit increase in digital sales and a low-single-digit rise in global brick-and-mortar sales, with strong and improving profitability across all channels.
Moreover, AI-driven customer engagement has enhanced pricing power and reduced reliance on promotions. Tapestry’s ability to attract and retain younger consumers, particularly Gen Z and Millennials, reinforces its strong market positioning.
Coach Brand: Key Growth Driver of TPR
Coach remains Tapestry’s growth engine, delivering impressive year-over-year revenue gains. This brand delivered an 11% year-over-year increase on a reported basis and 10% growth on a constant-currency basis in the fiscal second quarter. It also experienced 270 basis points of gross margin expansion.
The brand continues to expand its market share in handbags, with key collections, such as the Tabby and the new Brooklyn, and Empire bags performing exceptionally well. With strong global pricing power, Coach solidifies its leadership in accessible luxury and remains a compelling long-term investment.
Tapestry’s International Expansion Fuels Growth
Tapestry’s global strategy is paying off, with significant revenue growth in key regions. Notably, Europe continues to be a major growth driver, with revenues soaring 42% year over year in the fiscal second quarter, supported by strong local demand and successful customer acquisition efforts. Greater China, an essential market for luxury brands, returned to revenue growth with 2% year over year in the quarter, demonstrating the company’s resilience in a challenging economic environment.
Furthermore, APAC (excluding China) grew 11%, led by strong performances in South Korea, Malaysia, Australia and New Zealand. These results highlight Tapestry’s strength in global execution and its potential for sustained expansion.
TPR’s Upgraded Fiscal 2025 Guidance
Tapestry raised its full-year financial outlook. The company expects full-year revenues to exceed $6.85 billion, marking a 3% year-over-year increase despite currency headwinds. This is ahead of the previous guidance of $6.75 billion, which anticipated growth of 1-2% from the prior year on both reported and constant-currency basis.
Operating margin expansion is expected to be 100 basis points from the prior-year actual, an improvement over the previous guidance of more than 50 basis points. Earnings per share (EPS) is forecasted between $4.85 and $4.90, implying 13-14% growth from the prior-year number and exceeding the company's previous guidance of $4.50-$4.55.
Is Tapestry a Value Play Stock?
The company’s forward 12-month P/E ratio is 17.00, which is lower than the industry and the sector’s ratios of 19.25 and 25.64, respectively. This undervaluation highlights its potential for investors seeking attractive entry points. Moreover, TPR's Value Score of A underscores its appeal as an investment option.
TPR Looks Attractive From a Valuation Standpoint
Image Source: Zacks Investment Research
Estimate Revisions Favoring TPR Stock
Analysts have responded positively to Tapestry’s prospects as reflected in the upward revisions in the Zacks Consensus Estimate for EPS. In the past seven days, analysts have increased their estimates for the current fiscal year by 7 cents. The consensus estimate for earnings is pegged at $4.91 per share. The consensus estimate for the next fiscal year has also been raised 9 cents to $5.30 per share.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Image Source: Zacks Investment Research
Final Words on Tapestry
Investors will consider Tapestry as a strong investment due to its robust financial performance, strategic growth initiatives and strong brand positioning. The company’s operational efficiency, direct-to-consumer strength and AI-driven customer engagement enhance profitability and drive sustained momentum.
With Coach leading revenue growth and international markets contributing significantly, TPR demonstrates resilience and global expansion potential. Technical indicators signal bullish trends, while upgraded guidance and attractive valuation further boost investor confidence. Positive analyst revisions reinforce its growth trajectory, making TPR a compelling choice for those seeking long-term value in the luxury retail space. It currently holds a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Boot Barn’s fiscal 2025 earnings and sales indicates growth of 21.4% and 14.9%, respectively, from fiscal 2024 reported levels. BOOT delivered a trailing four-quarter average earnings surprise of 7.2%.
Genesco is a specialty retail and branded company, selling footwear and accessories in retail stores. It currently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Genesco’s fiscal 2025 earnings and revenues indicates growth of 67.9% and 1.5%, respectively, from fiscal 2024 reported figures. GCO delivered a trailing four-quarter average earnings surprise of 36.9%.
Deckers is a leading designer, producer and brand manager of innovative, niche footwear and accessories. It flaunts a Zacks Rank of 1 at present.
The Zacks Consensus Estimate for DECK’s fiscal 2025 earnings and revenues implies growth of 20% and 15.6%, respectively, from the year-ago actuals. DECK delivered a trailing four-quarter average earnings surprise of 36.8%.
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Tapestry Hits a New 52-Week High: How Should You Play the Stock Now?
Tapestry, Inc.’s (TPR - Free Report) shares reached a new 52-week high of $88.07 last Friday before closing at $87.70. So far, TPR stock has rallied 34.2% against the Zacks Retail-Apparel and Shoes industry’s sharp 5.7% decline.
The company’s ongoing operational efficiency and strategic efficiency have enabled it to outperform the broader Retail Wholesale sector and the S&P 500 index’s growth of 9.2% and 3.9%, respectively, during the same period.
TPR Stock Year-to-Date Performance
Image Source: Zacks Investment Research
Moreover, the company has shown solid upward momentum, currently trading above both its 50 and 200-day simple moving averages of $50.50 and $69.77, 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
TPR’s Strong Digital Channel & DTC Strength
Tapestry’s digital and direct-to-consumer (“DTC”) strategies continue to drive growth. The company saw solid gains in digital sales and improved profitability across all channels. In second-quarter fiscal 2025, the company achieved 4% growth in DTC sales, driven by a high-single-digit increase in digital sales and a low-single-digit rise in global brick-and-mortar sales, with strong and improving profitability across all channels.
Moreover, AI-driven customer engagement has enhanced pricing power and reduced reliance on promotions. Tapestry’s ability to attract and retain younger consumers, particularly Gen Z and Millennials, reinforces its strong market positioning.
Coach Brand: Key Growth Driver of TPR
Coach remains Tapestry’s growth engine, delivering impressive year-over-year revenue gains. This brand delivered an 11% year-over-year increase on a reported basis and 10% growth on a constant-currency basis in the fiscal second quarter. It also experienced 270 basis points of gross margin expansion.
The brand continues to expand its market share in handbags, with key collections, such as the Tabby and the new Brooklyn, and Empire bags performing exceptionally well. With strong global pricing power, Coach solidifies its leadership in accessible luxury and remains a compelling long-term investment.
Tapestry’s International Expansion Fuels Growth
Tapestry’s global strategy is paying off, with significant revenue growth in key regions. Notably, Europe continues to be a major growth driver, with revenues soaring 42% year over year in the fiscal second quarter, supported by strong local demand and successful customer acquisition efforts. Greater China, an essential market for luxury brands, returned to revenue growth with 2% year over year in the quarter, demonstrating the company’s resilience in a challenging economic environment.
Furthermore, APAC (excluding China) grew 11%, led by strong performances in South Korea, Malaysia, Australia and New Zealand. These results highlight Tapestry’s strength in global execution and its potential for sustained expansion.
TPR’s Upgraded Fiscal 2025 Guidance
Tapestry raised its full-year financial outlook. The company expects full-year revenues to exceed $6.85 billion, marking a 3% year-over-year increase despite currency headwinds. This is ahead of the previous guidance of $6.75 billion, which anticipated growth of 1-2% from the prior year on both reported and constant-currency basis.
Operating margin expansion is expected to be 100 basis points from the prior-year actual, an improvement over the previous guidance of more than 50 basis points. Earnings per share (EPS) is forecasted between $4.85 and $4.90, implying 13-14% growth from the prior-year number and exceeding the company's previous guidance of $4.50-$4.55.
Is Tapestry a Value Play Stock?
The company’s forward 12-month P/E ratio is 17.00, which is lower than the industry and the sector’s ratios of 19.25 and 25.64, respectively. This undervaluation highlights its potential for investors seeking attractive entry points. Moreover, TPR's Value Score of A underscores its appeal as an investment option.
TPR Looks Attractive From a Valuation Standpoint
Image Source: Zacks Investment Research
Estimate Revisions Favoring TPR Stock
Analysts have responded positively to Tapestry’s prospects as reflected in the upward revisions in the Zacks Consensus Estimate for EPS. In the past seven days, analysts have increased their estimates for the current fiscal year by 7 cents. The consensus estimate for earnings is pegged at $4.91 per share. The consensus estimate for the next fiscal year has also been raised 9 cents to $5.30 per share.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Image Source: Zacks Investment Research
Final Words on Tapestry
Investors will consider Tapestry as a strong investment due to its robust financial performance, strategic growth initiatives and strong brand positioning. The company’s operational efficiency, direct-to-consumer strength and AI-driven customer engagement enhance profitability and drive sustained momentum.
With Coach leading revenue growth and international markets contributing significantly, TPR demonstrates resilience and global expansion potential. Technical indicators signal bullish trends, while upgraded guidance and attractive valuation further boost investor confidence. Positive analyst revisions reinforce its growth trajectory, making TPR a compelling choice for those seeking long-term value in the luxury retail space. It currently holds a Zacks Rank #2 (Buy).
Other Stocks to Consider
Some other top-ranked stocks are Boot Barn Holdings, Inc. (BOOT - Free Report) , Genesco Inc. (GCO - Free Report) and Deckers Outdoor Corporation (DECK - Free Report) .
Boot Barn is a specialty retailer of premium, high-quality casual apparel. It flaunts a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Boot Barn’s fiscal 2025 earnings and sales indicates growth of 21.4% and 14.9%, respectively, from fiscal 2024 reported levels. BOOT delivered a trailing four-quarter average earnings surprise of 7.2%.
Genesco is a specialty retail and branded company, selling footwear and accessories in retail stores. It currently sports a Zacks Rank #1.
The Zacks Consensus Estimate for Genesco’s fiscal 2025 earnings and revenues indicates growth of 67.9% and 1.5%, respectively, from fiscal 2024 reported figures. GCO delivered a trailing four-quarter average earnings surprise of 36.9%.
Deckers is a leading designer, producer and brand manager of innovative, niche footwear and accessories. It flaunts a Zacks Rank of 1 at present.
The Zacks Consensus Estimate for DECK’s fiscal 2025 earnings and revenues implies growth of 20% and 15.6%, respectively, from the year-ago actuals. DECK delivered a trailing four-quarter average earnings surprise of 36.8%.