What Falling Estimates & Price Mean for Coach (COH)

Zacks

Similar to wise buying decisions, exiting certain underperformers at the right time helps maximize portfolio returns. Selling off losers can be difficult, but if both the share price and estimates are falling, it could be time to get rid of the security before more losses hit your portfolio.

One such stock that you may want to consider dropping is Coach, Inc. (COH), which has witnessed a significant price decline in the past four weeks, and it has seen negative earnings estimate revisions for the current quarter and the current year over the last 60 days. A Zacks Rank #5 (Strong Sell) further confirms weakness in COH.

A key reason for this move has been the negative trend in earnings estimate revisions. For the full year, we have seen 7 estimates moving down in the past 60 days, compared with 1 upward revision. This trend has caused the consensus estimate to trend lower, going from $3.06 a share two months ago to its current level of $3.05.

Also, for the current quarter, Coach has seen 5 downward estimate revisions versus 1 revision in the opposite direction, dragging the consensus estimate down to 54 cents from 56 cents over the past 60 days.   

The stock also has seen some pretty dismal trading lately, as the share price has dropped 15.06% in the past month.

So it may not be a good decision to keep this stock in your portfolio anymore, at least if you don’t have a long time horizon to wait.

If you are still interested in the Textile-Apparel industry, you may instead consider some better-ranked stocks including Columbia Sportswear Company (COLM), Hanesbrands Inc. (HBI) and Vince Holding Corp (VNCE). All these stocks hold a Zacks Rank #1 (Strong Buy) and may be better selections at this time.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>






COACH INC (COH): Free Stock Analysis Report

COLUMBIA SPORTSWEAR CO (COLM): Free Stock Analysis Report

HANESBRANDS INC (HBI): Free Stock Analysis Report

VINCE HOLDING CORP (VNCE): Free Stock Analysis Report


Zacks Investment Research

Rates

View Comments (0)