COH  Coach Inc.

Exchange

NYSE

Sector

Consumer Non-Durables

Industry

Apparel

Market Cap.

11.06B

Vuru Grade

65.34/100

Current Price

$39.14
-0.81 (-2.03%)

Growth Price

$21.18
Overvalued by 45.88%

Stability Price

$24.71
Overvalued by 36.86%

Company Metrics

  • P/E 18.73
  • P/S 2.52
  • P/B 3.75
  • EPS 2.09
  • Cash ROIC 36.34%
  • Cash Ratio 4.09
  • Dividend 1.35 / 3.38%
  • Avg. Vol. 3.30M
  • Shares 282.58M
  • Market Cap. 11.06B

Company Description

Coach, Inc. engages in the design and marketing of accessories and gifts for men and women in the United States and internationally. The company's primary products include handbags, women's and men's accessories, footwear and jewelry products, wearables, business cases, sunwear products, travel bags, fragrance products, and watches. Its accessories product line comprises women's small leather good... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Why Are We Bullish On Coach Inc.?
Nasdaq - Sep 21, 2017
Shares in Coach ( COH ) took a nosedive once the company released its fourth quarter and full year (year ended June 2017) earnings.
Coach, Inc. (NYSE:COH) Shares Bought by Skba Capital Management LLC - The Ledger Gazette
Coach Inc.: Bag That Dividend
Seeking Alpha - Aug 31, 2017
That said, I flatter myself that I do know a good stock when I see one, and I think Coach Inc. (NYSE:COH) is such an investment.
Coach, Inc. (COH) Ex-Dividend Date Scheduled for September 07, 2017
Nasdaq - Sep 6, 2017
Coach, Inc. ( COH ) will begin trading ex-dividend on September 07, 2017. A cash dividend payment of $0.338 per share is scheduled to be paid on October 02, 2017.
Coach: Viable Upside, But Not Enough Margin Of Safety
Seeking Alpha - Sep 19, 2017
Coach is on the right track executing its multi-year turnaround plan. Kate Spate acquisition is an important strategic move to help the company win millennial consumers.
Coach - The Recent Reaction Is Not Justified
Seeking Alpha - Aug 29, 2017
I have been moderately bullish on Coach (COH) for a while, although I have preferred to own Michael Kors (KORS) shares because they were even more attractive than COH.
Is It Time to go for Coach, Inc. (COH), SunPower Corporation (SPWR)?
StockNewsJournal - Sep 25, 2017
Coach, Inc. (COH) have shown a high EPS growth of -10.00% in the last 5 years and has earnings rose of 26.80% yoy. Analysts have a mean recommendation of 2.10 on this stock (A rating of less than 2 means buy, “hold” within the 3 range, “sell” within ...
Coach: There's A LOT Riding On Kate Spade Acquisition
Seeking Alpha - Sep 9, 2017
The stock fell 20% after COH management cautioned on KATE accretion, even though EPS and revenue estimates held firm after the quarter.
Analytical Guide for two rising stock's: Coach, Inc. (COH), Express, Inc. (EXPR)
StockNewsJournal - Sep 22, 2017
Coach, Inc. (NYSE:COH) market capitalization at present is $11.26B at the rate of $39.61 a share. The firm's price-to-sales ratio was noted 0.00 in contrast with an overall industry average of 85.01.
Investors must not feel shy to buy these stocks: H&R Block, Inc. (HRB), Coach ...
StockNewsJournal - 4 hours ago
H&R Block, Inc. (NYSE:HRB) market capitalization at present is $5.45B at the rate of $26.21 a share. The firm's price-to-sales ratio was noted 0.00 in contrast with an overall industry average of 83.88.
Northern Trust Corp Has $148.02 Million Stake in Coach, Inc. (COH)
The Ledger Gazette - 2 hours ago
Coach logo Northern Trust Corp reduced its position in Coach, Inc. (NYSE:COH) by 0.2% during the 2nd quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC).
Coach, Inc. (COH) Shares Sold by CIBC World Markets Inc. - Dispatch Tribunal
Coach, Inc. (NYSE:COH) Ratios & Quant Scores Under Review - BVN
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for COH to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate COH's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$39.14 Current Price

$21.18 Growth Price (DCF)

Overvalued by 45.88%


Growth Rate Assumed by Market: 19.33%


Future Free Cash Flow Growth Rate: -5.4%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$24.71 Stability Price (EPV)

Overvalued by 36.86%


Discount Rate: 15.0%

$3.98 NCA Price

Overvalued by 89.84%

$72.03 Book Price

Undervalued by 84.02%


Excellent Cash Return on Invested Capital over the past 5 years

COH has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. Annual Reports can be useful in identifying the cause of one-time events and future sustainability.

COH has created $36.34 of cash for every $100 invested.
Figures in USD. Fiscal year ends in June
20132014201520162017
Free Cash Flow 1.17B 765.82M 727.60M 353.30M 570.70M
divided by
Invested Capital 1.67B 1.98B 2.31B 2.75B 1.99B
Cash ROIC 70.03% 38.65% 31.55% 12.86% 28.62%

Excellent Return on Equity over the past 5 years

Over the past 5 years, COH has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

COH has generated $25.65 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in June
20132014201520162017
Net Income 1.03B 781.34M 402.40M 460.50M 591.00M
divided by
Stockholders' Equity 2.41B 2.42B 2.49B 2.68B 3.00B
Return on Equity 42.94% 32.28% 16.16% 17.16% 19.69%

Excellent Business Performance over the past 10 years

COH has been able to maintain profitability in good times and bad. This could mean COH has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

COH has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Free Cash Flow 748.64M 568.82M 909.76M 885.53M 1.04B 1.17B 765.82M 727.60M 353.30M 570.70M

Very Strong Balance Sheet

COH has more Cash than its Total Liabilities, resulting in $0.90 Net Cash per share. In other words, if you buy COH today, the price you're paying for shares is actually $38.24 because $0.90 of Cash is included in the current share price. This much Cash is very healthy. It can help COH sustain itself in the face of any economic turmoil and makes a stock buyback more of a possibility.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Cash 698.91M 800.36M 696.40M 702.04M 917.22M 1.13B 868.63M 1.53B 1.32B 3.08B
Current Assets 1.39B 1.40B 1.30B 1.45B 1.80B 2.07B 1.86B 2.51B 2.17B 3.95B
Total Assets 2.27B 2.56B 2.47B 2.64B 3.10B 3.53B 3.66B 4.67B 4.89B 5.83B
Current Liabilities 450.94M 459.65M 529.04M 593.02M 718.16M 722.51M 813.12M 834.70M 826.70M 753.80M
Total Liabilities 758.02M 868.29M 961.82M 1.02B 1.11B 1.12B 1.24B 2.18B 2.21B 2.83B
Stockholder' Equity 1.52B 1.70B 1.51B 1.61B 1.99B 2.41B 2.42B 2.49B 2.68B 3.00B
Current Ratio 3.07 3.04 2.46 2.45 2.51 2.87 2.28 3.00 2.63 5.24
TL-to-TA 0.33 0.34 0.39 0.39 0.36 0.32 0.34 0.47 0.45 0.49

Low or No Reinvestment of Profits over the past 10 years

COH has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to COH operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Retained Earnings 375.95M 499.95M -30.05M -445.65M -387.45M -101.88M -219.46M -189.60M -104.10M 107.70M
Retained Earnings Growth - 32.98% -106.01% -1,382.89% 13.06% 73.70% -115.40% 13.60% 45.09% 203.46%

Shrinking Competitive Advantage over the past 10 years

COH has a shrinking competitive advantage. This could be due to weakening branding, the inability to keep costs low, or by new competitors entering the industry. Look at its future prospects to determine sustainability and whether the economic moat will continue to shrink or if it will rebound.

$17.69 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Net Income 783.06M 623.37M 734.94M 880.80M 1.04B 1.03B 781.34M 402.40M 460.50M 591.00M
divided by
Revenue 3.18B 3.23B 3.61B 4.16B 4.76B 5.08B 4.81B 4.19B 4.49B 4.49B
Net Profit Margin 24.62% 19.30% 20.37% 21.18% 21.81% 20.38% 16.26% 9.60% 10.25% 13.17%

Strong Pricing Power over the past 10 years

COH has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$71.35 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Gross Profit 2.41B 2.32B 2.63B 3.02B 3.47B 3.70B 3.30B 2.91B 3.05B 3.08B
divided by
Revenue 3.18B 3.23B 3.61B 4.16B 4.76B 5.08B 4.81B 4.19B 4.49B 4.49B
Gross Margin 75.68% 71.90% 73.00% 72.71% 72.77% 72.86% 68.60% 69.39% 67.93% 68.65%

Medium Capital Intensity over the past 10 years

COH has used a reasonable amount of their financial resources to invest in facilities and equipment required to produce its goods and services. This isn't perfect, but it shouldn't be an area of concern unless this number is strongly trending upwards.

34.59% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Capital Expenditure 174.72M 240.33M 81.12M 147.74M 184.31M 241.35M 219.59M 209.80M 405.30M 283.10M
divided by
Net Income 783.06M 623.37M 734.94M 880.80M 1.04B 1.03B 781.34M 402.40M 460.50M 591.00M
Capital Expenditure Ratio 22.31% 38.55% 11.04% 16.77% 17.74% 23.33% 28.10% 52.14% 88.01% 47.90%

Strong Dividend History over the past 10 years

COH has consistently distributed a dividend for the past 8 years. This suggests COH is established and will likely continue to distribute its dividend for the foreseeable future.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Dividend Paid - - 94.32M 178.12M 260.28M 339.72M 376.50M 371.80M 374.50M 378.00M
divided by
Shares Outstanding 360.33M 325.62M 315.85M 301.56M 294.13M 286.31M 280.38M 277.20M 279.30M 282.80M
Dividend Paid Per Share - - 0.30 0.59 0.88 1.19 1.34 1.34 1.34 1.34
Price at Year End 19.68 36.01 55.23 61.04 54.30 56.39 37.86 32.67 35.02 45.27
Dividend Yield - - 0.54% 0.97% 1.63% 2.10% 3.55% 4.11% 3.83% 2.95%

Strong History of Stock Buybacks over the past 10 years

COH has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in June
2008200920102011201220132014201520162017
Shares Outstanding 360.33M 325.62M 315.85M 301.56M 294.13M 286.31M 280.38M 277.20M 279.30M 282.80M
Stock Bought Back - 10.66% 3.09% 4.74% 2.53% 2.73% 2.11% 1.15% -0.75% -1.24%
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