Project Runway judge and designer Michael Kors took the term "underwhelmed" to a whole new level a while back, and that’s somewhat appropriate given the way investors are treating his namesake company Michael Kors Holdings (KORS) this afternoon.
AFP/Getty Images Kors’ shares are under pressure, down 3.6% at 2:48 p.m., following a downgrade to Neutral from Buy by Citi's Oliver Chen. In the note, Chen acknowledged the company's 60% run in 2013 and cautioned that strong comps will beat expectations but, "to a lesser extent."
Chen also cut the price target to $93 from $95, and noted that the company trades higher than its peers:
We acknowledge KORS' price-to-earnings of 24 times versus three-year earnings-per-share growth compound annual growth rate of 30% could be modest; however, intrinsic discounted cash flow analysis points at our new target of $93 implies a fuller valuation and KORS' $16.8 billion market cap and enterprise value to sales (EV/Sales) of 5.03 exceeds accessible/luxury peers Tiffany (TIF) at $11.8 billion and 2.34 EV/Sales), Coach (COH) at $15.8 billion and 2.997 EV/Sales, and Ralph Lauren (RL) at $15.8 billion and 2.14 EV/Sales).
A quick check at competitors Chen mentions and we noted the following: Tiffany is up 0.2%, Coach is up 0.9% and Ralph Lauren is up 0.4%.
No comments:
Post a Comment