economy
Coach handbag parent tumbled 12% after earnings. JPMorgan tells clients to buy the dip
Tapestry shares should gain, despite their plunge Thursday. The revival of the Coach brand will underpin a likely rally, according to JPMorgan.
TL;DR
- JPMorgan recommends buying Tapestry shares, owner of Coach, due to an attractive trading level after its fiscal third-quarter earnings report.
- The investment bank has an overweight rating and raised its price target for Tapestry to $200 from $190.
- Tapestry's stock dropped over 12% after issuing weak guidance for the June quarter, raising concerns about demand for affordable luxury.
- JPMorgan is optimistic, citing the Coach brand's revival, success with Gen-Z shoppers, and a strengthened balance sheet.
- Coach led Tapestry's revenue gains in the third quarter, outperforming other brands like Kate Spade and Stuart Weitzman.
- The Wall Street consensus largely supports Tapestry, with 15 out of 24 analysts holding a buy or strong buy rating.