Does this double tailwind make KORS stock a buy here and now? I think so. At the very least, investors should be paying attention. Michael Kors is doing unprecedented things in the fashion industry, and the implications could be huge.
Part of the allure of luxury brands is that they are luxury, and luxury is a byproduct of scarcity. When a luxury brand becomes too affordable and too available, it loses its appeal. But, more importantly, the company also shifted its global growth strategy from building out the eponymous Michael Kors brand to creating a portfolio of luxury fashion brands. That is why the company acquired Jimmy Choo last year, is acquiring Versace, and is changing its name to Capri. Affordable luxury brands in the fashion world are subject to wild swings in popularity because they lack enduring appeal that comes with true luxury brands, but are also prone to big upswings in popularity due to their relatively low price-points.
As such, when the trend is your friend, sales and profits explode higher. Tonya Garcia is a MarketWatch reporter covering retail and consumer-oriented companies. You can follow her on Twitter tgarcianyc. She is based in New York. Tonya joined MarketWatch from Moguldom Media, where she was business editor for MadameNoire, a website targeting African-American women with a range of content from personal finance to economics, politics, education and lifestyle and entertainment.
ET First Published: Nov. Revenue at the Michael Kors brand fell Further, increasing penetration of the higher margin signature line and accessories category, as well as price increases, and rationalizing SKU counts should also lead to further margin expansion. BMO Capital Markets focused on the opportunities that the challenges of the pandemic have afforded.
But the future is looking up. This likely allows it to grow at least in line with the global market. Investing Best Accounts. Stock Market Basics. Stock Market. Industries to Invest In. Getting Started. Planning for Retirement.
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