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Published: Wed, February 08, 2017
Economy | By Melissa Porter

Why Michael Kors Holdings Ltd (NYSE:KORS) Shares Are Trading Down?

Why Michael Kors Holdings Ltd (NYSE:KORS) Shares Are Trading Down?

Michael Kors Holdings Limited (NYSE:KORS): On Friday heightened volatility was witnessed in Michael Kors Holdings Limited (NYSE:KORS) which led to swings in the share price. The company had revenue of $1.35 billion for the quarter, compared to the consensus estimate of $1.36 billion.

Michael Kors Holdings Limited (NYSE:KORS) last posted its earnings results on Thursday, November 10th. Non-GAAP earnings per share are estimated at $4.15-$4.19.

The results show that Michael Kors will continue to struggle with slowing sales and pressure on its margins, said Betty Chen, an analyst at Mizuho Securities. For fiscal 2017, Michael Kors expects earnings to be between $4.15 and $4.19 per share on revenue of $4.48 billion - much lower than Street forecast of $4.37 per share on $4.55 billion in revenue. The company expects total revenue of approximately $4.48 billion and for comps to decrease in the high-single digit range. Analysts, on average estimate earnings of $0.93 per share on revenues of $1.11 billion.

Michael Kors Holdings Limited (NYSE:KORS) opened at 40.89 on Friday. The businesses 50 day moving average is 42.67 and its 200 day moving average is 47.36. KORS stock was crushed Tuesday, falling by about 15% to fresh multiyear lows.

The Company has 163.73 million shares outstanding and 157.46 million shares were floated in market.

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Why Michael Kors Holdings Ltd (NYSE:KORS) Shares Are Trading Down?

A number of research firms recently commented on KORS. Morgan Stanley has been covering shares of KORS, so it is most recent view is worth a look.

The company said on Tuesday it would cut back promotions in North America, starting this month, to boost average retail prices. The stock was sold at an average price of $48.02, for a total value of $247,591.12. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. The company stated that it will continue with its expansion drive in Asia and further believes that it has a $1 billion opportunity over the long term. Massachusetts Financial Services Co.

Michael Kors has a long road ahead of them, and arguably a bumpier one than any of its competitors. AQR Capital Management LLC raised its position in shares of Michael Kors Holdings Limited by 37.5% in the second quarter. The Motley Fool owns shares of and recommends Coach. BlackRock Group LTD now owns 2,117,564 shares of the lifestyle brand's stock worth $104,778,000 after buying an additional 398,761 shares during the last quarter. The retailer desperately needs to demonstrate its ability to investors to begin organizing a concrete turnaround plan because if not, the once coveted Michael Kors logo and brand will be forever relegated to the discount aisle.

As of Dec 31, 2016, the company operated 816 retail outlets (397 in The Americas, 199 in Europe and 220 in Asia), including concessions.

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