While Tapestry’s sales and margins have been under pressure from production delays for quite some time, the management’s efforts to keep pace with the changing retail scenario and foray into new markets prove to be rewarding. In that respect, the future looks bright for the New York-based company that is currently expanding its store network to critical markets and revamping the brand portfolio.
Tapestry’s sales and margins have been under pressure from production delays for quite some time
The recent addition of the Kate Spade and Stuart Weitzman brands is widely viewed as strategic moves that enhanced Tapestry’s transformation into a multi-brand company.
For investors, the primary focus areas this time will be the newly launched smartwatch brand and Coach Create, an innovative offering that allows shoppers to customize bags. The new offerings are expected to complement the ongoing initiatives to expand the e-commerce platform and broaden the international supply chain, amidst mounting competition from online retailers. Still, the muted mall traffic across markets warrants additional promotional activities such as price reduction.
Among peers, last month Carters (CRI) reported better-than-expected earnings for its second quarter. Los Angeles, California-based Guess? (GES) is scheduled to release its second-quarter results on August 22 after the market closes.
Tapestry shares gained about 7% since the beginning of the year, all along witnessing significant volatility. The stock gained about 1% in early trading Monday, continuing the uptrend that began nearly a week ago.