KORS, the stock, is floundering after reporting another blowout quarter last week. The business and fundamentals of Michael Kors are as strong as ever. It is difficult to find companies growing like Michael Kors. What is going on here? Why is the stock not performing like most other growth stocks?
Currently, there is a disconnect between the business of Michael Kors and the stock performance of KORS.
I believe the stock action in KORS is purely technical. The stock is in a second stage base and forming the right side of its cup. Back in the day, we called this backing and filling. While some newbies piled in prior to earnings folks took profits on a a stellar report. This is healthy in the long run.
KORS will continue to grow globally, and the brand will continue to gain market share. I still think it is a long term hold in any growth portfolio.
The weekly charts are more beneficial when assessing the stock action in KORS.
AAPL will trade $92-$94 on Monday. Nobody knows where it will trade immediately following the stock split. However, after blowout earnings in July I expect AAPL to trade over $100 this year...
You are correct. The retail folks are at mercy of the criminals on Wall Street. Eventually, one hopes that earnings would be rewarded after all of the chicanery that goes on. Analysts are worthless...
VNCE has 36 million shares outstanding and only one million are sold short. The likelihood of a prong longed short squeeze is slim. It is more likely the stock runs way past any metric of value, and sells off back into the $20's.
VNCE is growing at half the rate of KORS with a multiple of 40, and folks say KORS is expensive...
VNCE has $150 million in debt…
Net sales for the first quarter of fiscal 2014 were $53.5 million, up 32.4% over the $40.4 million achieved during the first quarter of fiscal 2013. Comparable store sales for the first quarter of fiscal 2014 increased 11.1% over the first quarter of fiscal 2013.
Gross profit in the first quarter of fiscal 2014 increased 50.8% to $26.4 million from $17.5 million in the first quarter of fiscal 2013. Gross profit as a percentage of net sales increased to 49.4% from 43.4% in fiscal 2013. This increase was driven primarily by the year-over-year cycling on the additional inventory reserves taken in the first quarter of fiscal 2013 which contributed 370 basis points of the 600 basis point improvement in gross margin in the first quarter fiscal 2014.
Selling, general, and administrative expenses in the first quarter of fiscal 2014 were $21.2 million or 39.7% of sales compared to $15.6 million or 38.7% of sales in the first quarter of fiscal 2013 including public company transition costs. Excluding these costs, selling, general and administrative expenses as a percent of sales were 35.5% in the first quarter of fiscal 2013.
Operating income for the first quarter of fiscal 2014 increased 174% to $5.2 million compared to $1.9 million for the first quarter of fiscal 2013. Excluding public company transition costs from operating income for the first quarter of fiscal 2013, operating income for the first quarter of fiscal 2014 increased 64.1% compared to the same period in fiscal 2013 and, as a percent of sales, was 9.7% for the first quarter of fiscal 2014 compared to 7.9% for the same period in fiscal 2013.
Net income for the first quarter of fiscal 2014 was $1.4 million compared to a net loss of ($15.1) million for the first quarter of fiscal 2013, which includes the impact of public company transition costs and results of the non-Vince businesses that were separated on November 27, 2013.
GILD reported blowout earnings which were actually superior to the KORS blowout, and GILD still sold off. This is technical action, and is happening with low volume.
The fundamentals of this stock are undeniable.
We are a few weeks away, at least, from trading at $99.
KORS shares are up over 400% since the IPO. He is executing the business well.
Perhaps you think Coach, Vera Bradley, and Phillip Van Heusen have better management? No need for name calling..
Are you serious? We have had three lovely days of June, and you are going to determine interest is down? How does April-June compare to April-June 2013?
Google Trends is only one of many metrics I use to determine sales at KORS. Do you know the conversion rate from their Facebook page? Maybe those consumers don't need to "Google" Michael Kors any longer? They have nearly 14 million "friends" who shop from the Facebook page now.
There are far too many variables to determine that sales are slowing because Google trends says June 2013 Michael Kors had a 44 rating and in 2014 they have a 58 rating. The trend is still up at KORS. A big beat and raise quarter is looming in August.
I wonder if Ole Herb Greenberg will pounce on their shrinking margins due to discounting?
Something tells me no....as nobody is paying him to do so...
Earnings per share on a non-GAAP basis was $1.47 as compared to $1.91 in the prior year’s first quarter.
GAAP earnings per share was $0.42 as compared to the prior year’s first quarter loss per share of $(0.13).
Revenue was $1.964 billion, an increase of 4% on a non-GAAP basis as compared to the prior year amount excluding $47 million of revenue related to the Bass business (which was sold during the fourth quarter of 2013), despite revenue in the North American businesses being under significant pressure due to unseasonably cold weather across the region. On a GAAP basis, total revenue increased 3% as compared to prior year GAAP revenue of $1.910 billion. 2013 GAAP revenue was $30 million lower than revenue on a non-GAAP basis, attributable to sales returns for certain wholesale customers in the acquired Asia business in connection with an initiative to reduce excess inventory levels. The revenue increases over the prior year were principally driven by growth in the Company’s Tommy Hilfiger business of 6% and in the Company’s Calvin Klein business of 4% on a non-GAAP basis and 9% on a GAAP basis. These increases were partially offset by a revenue decline of 2% in the Company’s Heritage Brands business excluding the $47 million of 2013 Bass revenue, or 11% including such revenue.
Commenting on these results, Emanuel Chirico, Chairman and Chief Executive Officer, noted, “We are pleased with our first quarter results, which were in line with our expectations, despite the unseasonably cool weather in North America and the volatility experienced in the global retail environment in the first quarter. Unfortunately, the challenging macroeconomic environment has continued into the second quarter, with heightened promotional activity across the North American retail landscape. As such, we believe our North American businesses will experience margin pressure in the second quarter and we have lowered our full year earnings per share guidance to reflect this. We will continue to make the previously planned strategic investments, particularly in the acquired Calvin Klein businesses, in order to unlock the full global potential of the Calvin Klein businesses over the long-term.”
Coach retreats after analyst cuts rating to Neutral
Shares of luxury products retailer Coach (COH) are falling after research firm Sterne Agee lowered its rating on the stock to Neutral from Buy in a note to investors earlier today. WHAT'S NEW: Coach's North American business has been deteriorating and the company's fortunes don't appear set to rebound in the near-term, Sterne Agee analyst Ike Boruchow wrote. Meanwhile, the company's balance sheet and cash flow dynamics are weakening, while its earnings and multiple could drop, the analyst warned. Boruchow cut his price target on the shares to $41 from $51. WHAT'S NOTABLE: Another luxury products retailer, Michael Kors (KORS), reported stronger than expected fourth quarter results on May 28, but warned that it expects its gross margin to drop slightly this quarter versus the same period a year earlier. The stock fell significantly but has since made up some of its losses. PRICE ACTION: In late morning trading, Coach fell 2.4% to $39.07 and Michael Kors was up 0.3% at $94.33.
GILD has been forming a base for several months not. The biotech stock have had a nasty selloff, and now look primed for a run. GILD reported blowout earnings, and still sold off, and that is what happens when a stock is basing.
KORS fundamentals are fine, and I believe the current action is purely technical. Give it time and let it breathe… They are best of breed...
Thread is marked. I doubt we make new highs before August....
The stock reacted negatively to blowout earnings, and technically, it is forming a base...
Poor Herrbie....he is a desperate hack...
First, he whined about "Asian Inventories!" Then he complained about margins. Now, he says everyone is so confused.
KORS management seemed clear to me, and they have been really consistent. Go listen to their last 5-6 conference calls and see what they say about margins.
Most analysts upgraded the stock and raised price targets. I think Herb is the only one confused...