Marilyn Monroe famously said, "Give a girl the right shoes and she can conquer the world."
Coach could sure use better shoes to impress Wall Street. The company is going out of fashion quickly with investors.
Shares of Coach (COH) tanked nearly 10% Tuesday after the purse, shoe and accessory company reported worse than expected sales for its most recent quarter, especially in North America.
But Coach's woes aren't new. The stock is down more than 20% over the past 12 months.
These fashion firms compete heavily for middle and upper middle class buyers. They occupy the space just below the premier fashion houses like Prada and Chanel.
Coach handbags sell for several hundred dollars compared to the multi-thousand dollar price tags of the couture brands.
As spending began to pick up again after the recession, Coach soared in 2011 and 2012, but it has since struggled. People aren't buying the brand, and it has even had to close stores.
On a conference call with analysts, Coach CEO Victor Lewis stressed the multi-year turnaround that's underway.
"As our journey progresses, we have confidence our in vision of becoming a global lifestyle brand," Lewis said.
The company is banking on designer Stuart Vevers to revive the 70-year-old brand. He's a Brit with a track record of stirring things up at other brands, including Mulberry.
Vevers' designs are supposed to hit stores later this year. In February, Coach held its first ever New York Fashion Week presentation to showcase over a dozen "ready-to-wear" outfits by Vevers.
The clothes received good reviews, but what sells on the runway and to the fashion world elite doesn't always translate to stores. Moving into clothing would also be a big departure for a company that's carved out a niche in accessories.
At the moment, investors seem skeptical -- much like consumers.
"We think investors should and will wait for greater clarity on the company's long-term strategy, brand vision, and financial outlook to be provided at the upcoming June 4 investor day, and also to see how the new product lines developed under Vevers' direction perform initially at retail this fall," wrote Omar Saad, a partner at stock research firm ISI Group, in a note to clients.
Michael Kors is cashing in on a rebound in the luxury business as the jet-set starts to splurge again.
The high-end retailer reported earnings that blew past expectations early Wednesday as sales of bespoke handbags and flashy watches bounce back.
Shares of Michael Kors (KORS) rose about 3% in afternoon trading, despite a broad-selloff on Wall Street.
While the company offered cautious guidance, investors on StockTwits were still impressed with how strong sales MOREBen Rooney - May 29, 2013 3:28 PM ET
Coach is back in the game! Shares of the luxury handbag maker jumped 10% Tuesday after the company blew past earnings and revenue expectations thanks to solid sales growth around the world.
Overall revenue climbed 7% during the fiscal third quarter to $1.19 billion, with sales rising 7% in North America and 6% in international markets. Sales in China were among the strongest, climbing a whopping 40%.
"We're pleased with...the progress we're MOREHibah Yousuf - Apr 23, 2013 12:01 PM ET
"As you know in fashion, one day you're in. And the next day, you're out." That's one of Heidi Klum's catchphrases on "Project Runway." You can say the same about stocks. And for now, Ralph Lauren is decidedly in.
Shares of Ralph Lauren (RL) galloped (see what I did MOREPaul R. La Monica - Feb 6, 2013 12:08 PM ET
Ahead of Black Friday and the holiday shopping season, some retailers are looking rosy.
Michael Kors (KORS), Dicks Sporting Goods (DKS), TJ Maxx (TJX), Saks (SKS) all reported their latest quarterly results Tuesday. Shares of each moved higher. Home Depot (HD), which isn't as much of a Black Friday beneficiary, also posted strong results and cited the ongoing housing recovery. Shares of Home Depot and Dicks Sporting Goods each jumped MOREMaureen Farrell - Nov 13, 2012 2:25 PM ET
The luxury business is booming. Or at least it is for Michael Kors (KORS), the lifestyle brand founded by the Project Runway judge and fashion mogul of the same name.
In its second quarterly report as a public company, Michael Kors (the company) said earnings nearly tripled, easily surpassing forecasts. Sales surged 71% and the Hong Kong-based company also raised its outlook. Investors cheered the results. Shares of Michael Kors surged MOREBen Rooney - Aug 14, 2012 11:24 AM ET
Not a member yet?Sign up now for a free account