Latest news with #Telsey
Yahoo
4 days ago
- Business
- Yahoo
Can Burlington's Profit Levers Deflect Tariff Impact? Analysts Weigh In
Burlington Stores, Inc. (NYSE:BURL) shares are trading slightly higher on Friday. On Thursday, the company reported first-quarter adjusted earnings per share of $1.60, beating the analyst consensus estimate of $1.41. Quarterly sales of $2.50 billion missed the Street view of $2.52 billion. The company's CEO, Michael O'Sullivan, stated that while tariffs are expected to significantly impact merchandise margins, he is confident the company can offset this pressure in other areas of the profit and loss statement, provided tariffs do not rise beyond current are the key analysts' views on the company: Telsey Advisory Group analyst Dana Telsey reiterated the Outperform rating on Burlington, lowering the price forecast from $340 to $300. In an analyst note, Telsey noted that acquiring prime retail locations remains a key part of Burlington's strategy to expand its footprint and draw in high-value customers, especially as consumers increasingly prioritize value. However, due to macroeconomic uncertainty and rising costs tied to acquiring leases from bankrupt retailers, Telsey lowered the firm's price forecast. She highlighted that Burlington is adjusting its strategy and staying agile in response to current conditions. While tariffs are creating short-term challenges, management believes it won't cause lasting structural shifts in the retail sector. The company's FY25 outlook factors in a 30% tariff on imports from China and 10% on goods from other countries. To reduce its reliance on China, Burlington is collaborating with vendors and sourcing more products already located in the U.S., Telsey noted. She added that the company has several levers across the cost of goods sold and SG&A to help offset higher costs and support profitability. BofA Securities analyst Lorraine Hutchinson maintained the Buy rating on the stock, with a price forecast of $350. According to Hutchinson, the increased order volatility driven by shifting tariffs could actually improve merchandise availability for the off-price sector. She noted that Burlington's direct sourcing exposure remains modest at 8%, mostly tied to categories like Home and gifting. The analyst has modeled a flat gross margin for the second quarter. She anticipates 60 basis points of pressure on gross margin in the second half of the year as tariffs begin to flow through. However, she suggested that mitigation strategies could offset this future pressure once Burlington and its vendors have had sufficient time to adjust their production processes and pricing structures. The company has also seen strong comp performance at higher price points, with customers responding well to elevated merchandise. Hutchinson stressed that this trend will continue, especially as more price-sensitive consumers shift toward value options in response to broader retail price increases from tariffs. Price Action: BURL shares are trading higher by 0.23% to $228.33 at last check Friday. Read Next:Photo via Shutterstock Date Firm Action From To Mar 2022 Truist Securities Maintains Buy Mar 2022 Morgan Stanley Maintains Overweight Mar 2022 Deutsche Bank Maintains Buy View More Analyst Ratings for BURL View the Latest Analyst Ratings Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? BURLINGTON STORES (BURL): Free Stock Analysis Report This article Can Burlington's Profit Levers Deflect Tariff Impact? Analysts Weigh In originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
Yahoo
5 days ago
- Business
- Yahoo
Capri Holdings' Leaner Portfolio After Versace Sale Support FY26 Inflection: Analyst
Telsey Advisory Group analyst Dana Telsey reiterated the Market Perform rating on Capri Holdings Limited (NYSE:CPRI), raising the price forecast from $17 to $20. On Wednesday, the firm reported a fourth-quarter adjusted loss of $4.90 per share, missing the Street view of a 14-cent loss. Quarterly sales of $1.035 billion (down 15.4% year over year) outpaced the analyst consensus estimate of $986.57 million. On a constant currency basis, total revenue decreased 14.1%.Telsey writes that results were mixed, with a smaller-than-expected sales decline balanced by a more significant drop in gross margins. Since reporting Q3 FY25 in February, Capri has made several notable announcements, including long-term brand-specific targets at its Investor Day, the departure of longtime CFO/COO Tom Edwards, and the $1.375 billion sale of Versace to Prada. Telsey considers these significant developments for a company navigating a delicate phase following the failed acquisition attempt by Tapestry, Inc. (NYSE:TPR) in late 2024. Management has reaffirmed its goal of stabilizing operations through FY26, with a return to growth anticipated in FY27. However, Telsey points out that substantial effort is still required, particularly at Michael Kors, Capri's largest brand, which has posted ten straight quarters of revenue declines. While the company absorbed a sizable loss on its Versace investment, the sale is expected to enhance margins, improve the balance sheet, and create room for potential share buybacks. Still, the analyst notes that the macro environment remains difficult for the remaining MK and Jimmy Choo brands, and Capri has considerable work ahead as it seeks to reset its brand portfolio and rebuild momentum over the next two years. Telsey notes that for fiscal 2026, most of Michael Kors' production will be sourced from Vietnam, Cambodia, and Indonesia, while Jimmy Choo will continue to rely largely on manufacturing in Italy. As a result, only about 5% of Capri Holdings' total U.S. production volume is tied to China. Under current tariff assumptions, 10% general and 30% for imports from China, the company expects an unmitigated cost impact of approximately $60 million, which could reduce gross margin by around 100 basis points. At the same time, recent weakness in the U.S. dollar is projected to offer slight benefits to both sales and operating expenses in FY26, Telsey adds. Telsey now projects the company's FY26 revenue to drop by 24.3% to $3.36 billion, a sharper decline than the previously projected 7.7% fall. Despite the steeper top-line decline, Telsey has raised the FY26 EPS estimate to $1.33, up from the prior $1.02 forecast. For FY27, Capri Holdings anticipates a return to revenue growth, supported in part by operating margin expansion. Telsey attributes this expected margin improvement to expense leverage stemming from ongoing cost-cutting initiatives, which should help the company rebuild profitability as it stabilizes its business. Price Action: CPRI shares are trading higher by 1.66% to $18.34 at last check Thursday. Read now:Photo by T. Schneider via Shutterstock Date Firm Action From To Mar 2022 Telsey Advisory Group Maintains Market Perform Feb 2022 Morgan Stanley Maintains Overweight Feb 2022 Credit Suisse Maintains Neutral View More Analyst Ratings for CPRI View the Latest Analyst Ratings Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Capri Holdings' Leaner Portfolio After Versace Sale Support FY26 Inflection: Analyst originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
CNBC
10-05-2025
- Business
- CNBC
These household items have gotten pricier since Trump's tariffs announcement, new report finds
Not every day is a good day for Barbie, if prices for dolls in the U.S. keep rising amid President Donald Trump's tariff policy announcements. A series of household items including leggings, Barbie dolls power drills and washing machines have increased in price since Trump initially announced a sweeping set of global tariffs on April 2, according to an industry note issued by the Telsey Advisory Group on Tuesday. Between April 16 and April 30, the price of a Target-exclusive Barbie doll increased by nearly 43% to $14.99, up from $10.49, Telsey reported. A Whirlpool washing machine at Lowe's went up in price by nearly $82 to $599, over the same time frame. Other notable price hikes include Girl's Cat and Jack leggings at Target, which went up by nearly a third — to $6, from $4.50 — and a Dewalt drill at Tractor Supply that rose by $20, to $179. (As of Friday afternoon, the drill is on sale for $99.) The Telsey analysis included luxury items, too. A medium Louis Vuitton Neverfull tote bag will run you $2,130 today, for example — $100 more than on April 16, Telsey noted. The price changes in the Telsey note shouldn't be viewed as definitive evidence of tariff impact, its authors wrote. The group tracked only one or two items per analyzed company, and didn't account for extant discounts or internal pricing strategies. Some of the consumer items tracked by Telsey didn't change in price. Others became less expensive. But if higher consumer prices due to tariffs aren't yet a reality for Americans, they will be soon, said Telsey's note. "A consistent narrative across retailers and brands is that higher costs will be passed on to consumers," its authors wrote. "Many management teams are accelerating and attempting to make 'non-regrettable' decisions about the supply chain and/or product price changes." Each product tracked by Telsey was chosen based on factors like its expected longevity and connection to Chinese manufacturing. Most of the tariffs initially announced by Trump are paused until July 9, replaced instead by a 10% baseline tariff on all foreign goods — but Chinese imports currently face a levy of 145%. Many American companies that manufacture products in China have publicly discussed plans to diversify their supply chains. But few have expressed a willingness to relocate production specifically to the U.S., with some CEOs saying the country lacks the manufacturing expertise to make high-quality goods at business-friendly prices. "Design, development, product engineering, brand management all happens in America," Barbie-maker Mattel CEO Ynon Kreiz told CNBC's "Squawk Box" on Tuesday. "Making product, producing product in other countries, allows us to create quality products at affordable price points." Trump reportedly hit back at Mattel on Thursday, threatening to place a 100% tariff on the company if it took its manufacturing "somewhere else." It's unclear how exactly such a tariff could be implemented. The president also suggested on Friday that the U.S. could potentially lower its tariffs on China to 80%, still be a high rate. Previously, he indicated that consumers should simply buy fewer dolls, in response to price hikes. "I don't think that a beautiful baby girl needs — that's 11 years old — needs to have 30 dolls," Trump told NBC News' "Meet the Press" on Sunday. "I think they can have three dolls or four dolls, because what we were doing with China was just unbelievable."
Yahoo
02-05-2025
- Business
- Yahoo
Floor & Decor Prepared For Current Tariffs As Sourcing Shift Limits China Exposure: Analyst
Telsey analyst trimmed the price forecast for Floor & Decor Holdings, Inc. (NYSE:FND) from $115 to $100 while keeping an Outperform rating. On Thursday, the company reported first-quarter EPS of 45 cents, missing the 46 cents estimate, while net sales of $1.16 billion were inline. The company lowered its FY25 GAAP EPS guidance to $1.70-$2.00 from $1.80-$2.10 (vs. $1.97 est) and narrowed its sales guidance to $4.66 billion-$4.80 billion (from $4.47 billion-$4.90 billion) vs. $4.82 billion est. The analyst writes that Floor & Decor adopted a more cautious stance after a first-quarter 2025 comp decline of -1.8% (transactions down 4%). The second quarter comp is tracking at +1%, a sequential improvement but likely below expectations, adds the analyst. The analyst says that Floor & Decor is well-prepared for current tariffs, having significantly shifted sourcing since 2018, reducing China exposure from 50% to 18% by 2024 while increasing US sourcing to 27%. Their strategy involves vendor negotiation, further sourcing shifts, and price adjustments, adds the analyst. Telsey writes that despite the disappointing guidance reduction, they remain optimistic about the company's market position and long-term growth potential, driven by store expansion, product innovation, high-margin categories, commercial market initiatives, and Spartan Surface. For FY25, the analyst lowered the EPS estimate to $1.90 (from $2.06; FS $1.96) with a comp of 0.1% (from 2.4%; FS 1.4%) and an operating margin of 5.6% (down ~10 bps; previously 6.0%; FS 5.7%). For 2026, Telsey now sees an EPS estimate of $2.45 (from $2.68; FS $2.54) with a comp of 4.5% (from 5.0%; FS 4.9%) and an operating margin of 6.4% (up ~80 bps; previously 6.8%; FS 6.6%). Price Action: FND shares gained 2.51% to $74.06 on Friday. Read Next:Photo via Shutterstock Date Firm Action From To Feb 2022 Loop Capital Maintains Hold Feb 2022 Telsey Advisory Group Maintains Outperform Feb 2022 Wells Fargo Maintains Overweight View More Analyst Ratings for FND View the Latest Analyst Ratings Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Floor & Decor Prepared For Current Tariffs As Sourcing Shift Limits China Exposure: Analyst originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
Yahoo
02-05-2025
- Business
- Yahoo
No Quick Fix for Kohl's: Analyst Highlights Challenges Despite Leadership Change
Telsey analyst Dana Telsey lowered the price forecast for Kohl's Corporation (NYSE:KSS) from $10 to $9, while retaining a Market Perform rating. On Thursday, the company announced the termination of CEO Ashley Buchanan for cause and appointed Board Chair as Interim CEO. Also, Kohl's issued preliminary first-quarter 2025 results, expecting comparable sales to decline between 4.3% and 4.0%, operating income between $40 million and $45 million, and diluted EPS of a loss of 20 cents to a loss of 24 cents. The analyst writes that the CEO position at Kohl's appears to have been difficult to maintain since Michelle Gass's departure in late 2022. Barclays Flags Macy's, Kohl's Risks During Consumer Weakness; Highlights Gildan, Levi's For Strength The retailer has faced headwinds, experiencing market share losses over the last several years, even with positive developments like the introduction of Sephora shop-in-shops and Babies'R'Us, adds the analyst. Telsey writes that Kohl's has lost ground to off-price retailers, which offer a straightforward value proposition, and e-commerce platforms such as Amazon, due to their convenience and rapid delivery. The analyst further says that despite the leadership change, Kohl's anticipates continuing Buchanan's strategies (curated assortment, value/quality, frictionless experience) under the interim CEO. New leadership will likely focus on stabilization, but consumer recovery will take time, adds the analyst. Investors can gain exposure to the stock via First Trust DJ Global Select Dividend (NYSE:FGD) and Invesco Exchange-Traded Fund Trust II Invesco S&P SmallCap 600 Revenue ETF (NYSE:RWJ). Price Action: KSS shares are up 4.37% at $7.53 at the last check Friday. Read Next:Photo: Shutterstock Date Firm Action From To Mar 2022 Telsey Advisory Group Maintains Market Perform Mar 2022 Credit Suisse Maintains Neutral Feb 2022 Gordon Haskett Downgrades Buy Accumulate View More Analyst Ratings for KSS View the Latest Analyst Ratings Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? KOHL'S (KSS): Free Stock Analysis Report This article No Quick Fix for Kohl's: Analyst Highlights Challenges Despite Leadership Change originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
