Coach, Inc. (NASDAQ: COH)
Coach, Inc. (COH), a luxury accessories company yesterday reported positive Fiscal 2016 second quarter financial results. Coach reported adjusted earnings per share of $0.68 which beat analyst expectations of $0.67. Coach reported total net sales for the second quarter of $1.27 billion which was 4% higher than the same period of the previous year.
Coach, Inc. CEO’s Comments
Victor Luis, Chief Executive Officer of Coach, Inc., said, “We are very pleased with our second quarter performance, which was consistent with our expectations and reflected the most significant progress to date on our transformation plan despite the difficult retail environment globally. We drove further sequential improvement in our North America bricks and mortar business – led, as expected, by our retail stores, while our outlet store channel also strengthened against a backdrop of lower tourist traffic and a highly promotional environment. Our international businesses posted strong growth on a constant currency basis, highlighted by double-digit increases in Europe, and Mainland China, as well as sales gains in Japan. Overall, our results continue to give us confidence that the cumulative impact of our actions will result in a return to top line growth this fiscal year and positive North American comps by our fourth quarter. We were also excited about Stuart Weitzman’s results during the quarter, which exceeded expectations. Boots in particular sold well, notably in domestic retail stores, and in spite of the unseasonably warm weather. This performance clearly reflected the brand’s strong development of fashionable, trend-right product and its growing relevance with an increasing number of consumers globally. Importantly, we are effectively integrating Stuart Weitzman to Coach, Inc. while continuing to successfully execute the Coach brand transformation.” Business Wire
COH Technical Analysis
COH gapped up in price yesterday to $32.77, up from the prior day’s close of $30.35, which is a 8% increase in price. Taking a look at the daily chart we can see that the last time COH traded at this price level was on January 11th when it traded at $32.77. Taking a closer look at the daily chart we can see that COH has been in a trading range in between $29-$34 dating back to October 2nd. With the gap up in price I would expect COH to test the top end of the range. COH has a float of 277.18 million shares and is trading almost 3 times the normal daily trading volume. COH hit pre market highs of $33.30, but gave back $0.53 at the open, or equivalent to 2%. For trading purposes, my entry point would have been $32.85 looking for a run to $34. My stop loss would have been $32.65 fearing anything below that and the stock would start to fill in the gap up.
Coach, Inc. provides luxury accessories and lifestyle collections in the United States. The company offers handbags, rings, charms, small leather goods, and novelty accessories for women; and business cases, computer bags, messenger-style bags, totes, wallets, card cases, belts, and time management and electronic accessories for men. It also provides footwear products; seasonal lifestyle apparel collections, including outerwear, ready-to-wear, and cold weather accessories, such as gloves, scarves, and hats; jewelries comprising bracelets, necklaces, rings, and earrings made with sterling silver, leather, and non-precious metals; sunglasses; watches; and fragrances consisting of eau de perfume sprays, eau de toilette sprays, purse sprays, and body lotions. In addition, the company offers weekend and travel accessories, travel bags, and other lifestyle products. Further, it holds licensing rights to market and distribute footwear, eyewear, watches, and fragrances under the Coach brand name. The company markets its products to consumers through a network of company-operated stores comprising Internet in North America; and Coach-operated stores and concession shop-in-shops in Japan, Mainland China, Hong Kong, Macau, Singapore, Taiwan, Malaysia, South Korea, the United Kingdom, France, Ireland, Spain, Portugal, Germany, Italy, Belgium, and the Netherlands. It also sells its products to wholesale customers and distributors in approximately 45 countries. As of June 27, 2015, the company operated 258 Coach retail and 204 Coach outlet leased stores located in North America; 503 Coach-operated concession shop-in-shops within department, retail, and outlet stores internationally; and 54 Stuart Weitzman stores. Coach, Inc. was founded in 1941 and is based in New York, New York. Yahoo Finance