Replies to post #106071 on Savvy Trades and Investments

[wadegarret]

R59- CPRI

I've liked this one for some time. However important to note how bad it acted when the market got hit hard in early 2020. While I realize the average stock went down 33% from Jan 2020 to Mar 2020, CPRI went down around 80%, and was $8.50 in Mar 2020. Point being that CPRI is highly vulnerable to market corrections. I mean I realize that 2020 was a bad year for CPRI earnings wise, but it was $38 in Dec 2019, and spiked up to $42 by Dec 2020. In other words, if it was just bad earnings for CPRI in 2020, it wouldn't have spiked to $42 in Dec after reporting a bad year.

I also note that even with eps expectations over $6 during the early Ukraine situation, the stock went down to around $35-$40 from the $70s. My problem is that if the stock went down to $40 or so because of the expected lower demand in Europe from the Ukraine situation, and spiked all the way back to $68 in January, only to fall again to $37 now, that something is amiss. I mean Ralph Loren is sitting at 52 week highs ! Re, I haven't been following the stock for months now. Is there some reason the stock has almost gotten cut in half,despite having analysts expecting $6 for fiscal 2024, and $6.75 for fiscal 2025 ?

[bobkubecka]

CPRI Thanks for posting on this one at $37!
Coach parent Tapestry buying Capri, owner of Michael Kors and Versace, in $8.5 billion deal

NEW YORK (AP) — Tapestry, parent company of luxury handbag and accessories retailer Coach, is buying the owner of fashion brands including Michael Kors, Versace and Jimmy Choo, Capri Holdings. The approximately $8.5 billion deal puts Tapestry in a better position to take on its big European fashion rivals.

U.S. fashion houses have been attempting to take on powerhouses in Europe like LVMH and Kering.

Tapestry, whose brands also include Kate Spade and Stuart Weitzman, said Thursday that the combined company had global annual sales of more than $12 billion and has a presence in more than 75 countries.

Capri Holdings shareholders will receive $57.00 per share in cash.

French luxury conglomerate Kering reached a deal in July to buy a 30% stake in Italian fashion house Valentino for 1.7 billion euros from Qatari investment firm Mayhoola. Under the agreement, Kering, which owns Gucci, has the option to buy 100% of Valentino no later than 2028.

Kering had also tried to snap up Tom Ford, but beauty company Estee Lauder wound up reaching a deal with the luxury goods maker.

LVMH, meanwhile, purchased famed jewelry company Tiffany in 2021 after a back-and-forth between the two companies over the agreement.

The boards of Tapestry and Capri have approved the deal, which is expected to close next year. It still needs approval from Capri shareholders.