VFC - V.F. Corp. Is Hitting Peak Pessimism

2024-03-25 03:28:27 ET

Summary

• V.F. Corporation has been an underperforming stock, losing over 80% of its value since 2019.
• The company's management has been making efforts to turn the business around, including cost-cutting measures and a dividend cut.
• Despite short-term fluctuations, patient investors may be rewarded as the company's turnaround efforts take time to bear fruit.
• $14 looks like a support level and shares may bounce in the coming months.

V.F. Corporation ( VFC ) has been one of the most underperforming stocks of the S&P 500 ( SPY ) for the several years. As most readers will know well, shares have lost over 80% of their value since peaking at the end of 2019. A combination of poor management and declining brand power have led to a significant decline in profitability and, more recently, a drop in revenue. This story is well-known in the investing community and has driven activist investment in the stock and a turnover in management. Since the interim market lows in October 2023, shares have been basically flat as the broader market has gained over 20%. As small pieces of news have come out about the turn-around efforts - a decline in overall revenue, initial efforts to cut costs, a withdrawal of 2024 guidance - the shares have swung widely between $13 and $20 per share....

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