VFC - V.F. Corporation Is A Strong Buy: This Bargain Stock Is My Top Turnaround For 2024
2024-04-26 09:31:21 ET
Summary
- V.F. Corporation has experienced significant underperformance, resulting in its removal from the S&P 500 Index and a loss of over $34 billion in shareholder value.
- The company is undergoing a strategic turnaround under new CEO Bracken Darrell, who has a successful track record of turnarounds in previous roles.
- Activist investor Engaged Capital is involved in the company and has outlined key strategies for the turnaround, including cost reductions, restoring brand autonomy, addressing the capital structure, and governance/board changes.
Thesis
After multiple years of underperformance, V.F. Corporation ( VFC ) was recently dropped from the S&P 500 Index. After reaching all-time highs of $100.25 in 2020, shares have since plummeted by over 87%, culminating to a loss of over $34B in shareholder value. A mix of poor managerial decisions, ill-timed acquisitions at high multiples, and a decline in brand strength drove these results. With pessimism at all-time highs, many have written VFC off for dead. However, VFC is a battle-tested company with a 125-year history of weathering economic cycles. With a new CEO, Bracken Darrell, and a clear strategic turnaround plan, signs of a recovery are beginning to emerge. Let’s take a deep dive into the current situation at V.F. Corporation and determine how cheap this valuation really is.
Brief Company Overview
While the name V.F. Corporation may not ring a bell, nearly every reader is likely familiar with the iconic brands under the umbrella. Some of these legendary brands include The North Face, Vans, Timberland, Supreme, and Dickies....
V.F. Corporation Is A Strong Buy: This Bargain Stock Is My Top Turnaround For 2024