Michael Kors Holdings Limited (NASDAQ: KORS)
Michael Kors Holdings Limited (KORS), a retail apparel and accessories company made an announcement on Wednesday stating positive financial results for fiscal 2016 second quarter ended September 26,2015. Total Revenue increased 6.9%, Retail net sales increased 7.5%, and Gross profit increased 3% compared to second quarter fiscal 2015.
Michael Kors Holdings Limited CEO Comments
John D. Idol, the Company’s Chairman and Chief Executive Officer, said:
“We are pleased with our second quarter results, which were ahead of expectations and reflected the continued expansion of our luxury brand worldwide. We drove growth in our retail and wholesale segments as well as across our operating regions in the Americas, Europe and Japan, with our compelling fashion products and jet set shopping experience. Importantly, in our retail segment, our North American digital flagship sales continued to accelerate this quarter and we drove sequential improvement in our comp performance. Looking ahead, we believe we are well positioned for a positive holiday period with our exciting new product introductions and gifting assortments in addition to a captivating marketing campaign, all of which are designed to inspire our customer to celebrate the season with effortless glamour and style. The Michael Kors luxury brand remains incredibly strong, and we are focused on continuing to execute our strategic initiatives to drive long-term sustainable growth.” Business Wire
KORS Technical Analysis
KORS gapped up in price yesterday to $40.00, up from the prior day’s close of $39.32, which is a 2% increase on the favorable news. Taking a look at the daily chart, we can see the last time KORS traded above this price level was on October 16th, when it closed at $40.28. KORS has been on an overall decline dating back to May 22nd when it traded at $61.63. Only two trading days later, KORS tanked all the way down to $45.88, equivalent to a 26% drop in price. Since that drop, KORS has been ranging in between $39 – $45. With the favorable news I would expect to see KORS make a move up to trade at the higher end of that range. KORS does have a high float of 186.2 million shares and is trading at 3 times the normal daily trading volume. KORS did reach pre market highs of $44.00, but gave back $4.00 at the open, or equivalent to 9%. For trading purposes, my entry point would have been $40.20 looking for a run to $42. My stop loss would have been $30.90, fearing anything below that and the stock would start to fill in the gap up.
Michael Kors Holdings Limited engages in the design, marketing, distribution, and retailing of branded womens apparel and accessories, and mens apparel. The company operates in three segments: Retail, Wholesale, and Licensing. The Retail segment is involved in the sale of womens apparel; accessories, which include handbags and small leather goods, such as wallets; footwear; and licensed products comprising watches, jewelry, fragrances and beauty, and eyewear. As of March 28, 2015, this segment operated 343 North American retail stores, including concessions and its U.S. e-commerce site; and 183 international retail stores, including concessions in Europe and Japan. The Wholesale segment sells accessories, such as handbags and small leather goods, footwear, and womens and mens apparel to department stores and specialty shops in North America, Europe, and Asia. The Licensing segment licenses its trademarks on products, such as fragrances, beauty, eyewear, leather goods, jewelry, watches, coats, mens suits, swimwear, furs, and ties, as well as licenses rights to third parties to sell the companys products in geographical regions, such as the Middle East, Eastern Europe, Latin America, the Caribbean, Asia (excluding Japan), and Australia. The company sells its products under the names of MICHAEL KORS, MICHAEL MICHAEL KORS, and various other related trademarks and logos. Michael Kors Holdings Limited was founded in 1981 and is based in London, the United Kingdom. Yahoo Finance