Luxury handbag maker Coach, Inc. (
) on Tuesday posted better-than-expected fourth quarter earnings,
fueled by higher sales of its trademark products in the U.S. and
The New York-based company reported fiscal fourth quarter net
income of $195.5 million, or 64 cents per share, compared with
$145.8 million, or 45 cents per share, in the year-ago period.
On average, Wall Street analysts expected a smaller profit of 56
cents per share.
The earnings beat was driven by a 22.2% jump in quarterly sales,
which rose to $950.5 million. Excluding the positive effects of an
extra week in this year's period, sales would have risen 13%.
The company also noted that its gross margins rose 2.9
percentage points in the period, to 73.3%, due to lower outsourcing
Coach shares rose 57 cents, or +1.5%, in premarket trading
The Bottom Line
We had removed shares of COH from our recommended list back on May
17, when the stock was trading at $40.06. The company has a 1.56%
dividend yield, based on last night's closing stock price of
$38.43. The stock has technical support in the $35-$36 price area.
If the shares can firm up, we see overhead resistance around the
$44-$45 price levels. We would remain on the sidelines for now.
Coach, Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.4 out of 5 stars.
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