Cowen analyst Oliver Chen became the latest analyst to dim his view of Capri Holdings ( NYSE: CPRI ) after a big earnings miss in the past week.
Chen moved his rating on the stock to Market Perform from a prior Outperform rating, noting that elevated inventory levels and softness in key brands could hamper upside. Chen also cut his price target from $70 to $55, advising that Tapestry ( TPR ) is safer bet in luxury retail at present.
“We downgrade shares of CPRI to Market Perform on fears that the wholesale channel could get worse before improving, as well as concerns on customer demand at MK amid a somewhat bumpy path thus far as the brand pursues an elevation strategy,” he explained. While we acknowledge CPRI’s improvement in new customer adds and progress in the signature product, we believe luxury brands (such as Louis Vuitton and Dior) and [Tapestry] ( TPR ) are gaining share relative to CPRI.”
Shares of Capri Holdings ( CPRI ) marked a modest decline in premarket trading on Monday. The London-based luxury fashion company’s stock has slumped about 25% since its earnings release on February 8.
Read more on the recently reported earnings result .
For further details see:
Capri Holdings cut to Hold at Cowen on Michael Kors concerns