COH  Coach Inc.

Exchange

NYSE

Sector

Consumer Non-Durables

Industry

Apparel

Market Cap.

11.28B

Vuru Grade

65.34/100

Current Price

$39.90
-0.38 (-0.94%)

Growth Price

$21.17
Overvalued by 46.93%

Stability Price

$24.70
Overvalued by 38.09%

Company Metrics

  • P/E 19.09
  • P/S 2.54
  • P/B 3.78
  • EPS 2.09
  • Cash ROIC 36.34%
  • Cash Ratio 4.09
  • Dividend 1.35 / 3.35%
  • Avg. Vol. 3.66M
  • Shares 282.71M
  • Market Cap. 11.28B

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

Tapestry, Inc.: From Handbags To A Powerful Branding Business
Seeking Alpha - 19 hours ago
Tapestry Inc., formerly known as Coach, is no longer just a handbag business. It has transformed itself into an incredibly powerful branding business.
Tapestry, Inc. Reports Fiscal 2018 First Quarter Results
Business Wire (press release) - Nov 7, 2017
Victor Luis, Chief Executive Officer of Tapestry, Inc., said “Our first quarter performance was in line with our expectations, reflecting the benefits of our diversified multi-brand model, notably the contribution of Kate Spade to our consolidated ...
Tapestry, Formerly Coach, Looks to Wring Savings From Kate Spade - Bloomberg
Tapestry edges up after earnings - Seeking Alpha
Tapestry, Inc. Declares Quarterly Cash Dividend
Business Wire (press release) - Nov 7, 2017
NEW YORK--(BUSINESS WIRE)--Tapestry, Inc. (NYSE:TPR) (SEHK:6388), a leading New York-based house of modern luxury accessories and lifestyle brands, today announced that its Board of Directors has declared a quarterly cash dividend of $0.3375 ...
Tapestry Inc. to Withdraw From Hong Kong Stock Exchange
WWD - Nov 1, 2017
HONG KONG - Tapestry Inc., formerly known as Coach Inc., plans to withdraw its listing from the main board of the Hong Kong Stock Exchange, it said Wednesday, although the company said it remains focused on developing in Greater China.
Glencore, Coach Say Adieu to Hong Kong Listings Amid Low Volumes - Bloomberg
Coach joins Glencore in applying to withdraw shares from Hong Kong - Reuters
Tapestry, Inc. to Host First Quarter of Fiscal Year Earnings Call
Business Wire (press release) - Oct 31, 2017
NEW YORK--(BUSINESS WIRE)--On Tuesday, November 7, 2017 at 8:30 a.m. (ET), Tapestry, Inc. (NYSE:TPR) (SEHK:6388) will hold a conference call to discuss the company's first quarter results and strategic initiatives, which will be reported via press ...
These stock's have rarely let down their investors: Tapestry, Inc. (TPR ...
StockNewsJournal - 20 hours ago
Tapestry, Inc. (NYSE:TPR) market capitalization at present is $11.77B at the rate of $42.07 a share. The firm's price-to-sales ratio was noted 2.50 in contrast with an overall industry average of 2.33.
Point View Wealth Management Inc. Buys New Holdings in Tapestry, Inc. (TPR) - The Ledger Gazette
Analyst Scores Summary: Tapestry, Inc. (TPR), CDW Corporation (CDW) - USA Commerce Daily
Reading the Tea Leaves for Tapestry, Inc. (TPR)
Economic News - 19 hours ago
Over the last few days fluctuation in the stock of Tapestry, Inc. (NYSE:TPR) was the main talking point of investors.
Deborah Lloyd Steps Down as Creative Director of Kate Spade New York
Fashionista (blog) - Nov 8, 2017
A month after Kate Spade was acquired by Tapestry Inc., formerly Coach, Inc., significant changes are already underway behind the scenes at the cheeky womenswear and accessory label.
Tapestry Appoints Nicola Glass Creative Director of Kate Spade - Business Wire (press release)
Kate Spade Integration Weighs On The Margins For Tapestry - Nasdaq
Is It Overvalued? Look at the P/S Ratio: Tapestry, Inc. (TPR), New Residential ...
AllStockNews - 18 hours ago
Tapestry, Inc. (NYSE:TPR) shares were trading higher by 0.98 percent ($0.41) at $42.07 a piece in Monday's session.
Tapestry's (TPR) CEO Victor Luis on Q1 2018 Results - Earnings Call Transcript
Seeking Alpha - Nov 7, 2017
Good morning and thank you for joining us. With me today to discuss our quarterly results and annual forecast are Victor Luis, Tapestry, Inc.'s Chief Executive Officer; and Kevin Wills, Tapestry CFO. Before we begin, we must point out that this ...
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.

$39.90 Current Price

$21.17 Growth Price (DCF)

Overvalued by 46.93%


Growth Rate Assumed by Market: 19.97%


Future Free Cash Flow Growth Rate: -5.4%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$24.70 Stability Price (EPV)

Overvalued by 38.09%


Discount Rate: 15.0%

$3.97 NCA Price

Overvalued by 90.04%

$72.03 Book Price

Undervalued by 80.52%


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 $39.00 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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