Coach profit tops analysts’ estimates as holiday sales gain
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Coach Inc., the largest U.S. luxury handbag maker, reported a 15 percent increase in quarterly profit that topped analysts’ estimates, driven by holiday sales in North America.
Net income in the fiscal second quarter ended Dec. 31 rose to $347.5 million, or $1.18 a share, from $303.4 million, or $1, a year earlier, New York-based Coach said today in a statement. Analysts projected $1.15 a share, the average of 24 estimates compiled by Bloomberg.
Shoppers bought $428 Madison satchels, $298 Kristin shoulder bags and $198 Poppy totes after consumer confidence rose to an eight-month high in December and financial markets stabilized. Sales at North American stores open at least a year climbed 8.8 percent, exceeding the 7 percent estimate of Michael Binetti, an analyst at UBS Securities LLC, and the 5 percent projection of David Schick at Stifel Nicolaus & Co.
Chief Executive Officer Lew Frankfort has been opening more stores in China and expanding Coach’s line of men’s goods. Revenue advanced 15 percent to $1.45 billion, topping the $1.43 billion average estimate of 21 analysts.
Coach fell 0.9 percent to $62.24 in New York yesterday. The shares gained 10 percent last year.
Schick, who is based in Baltimore, recommends buying the shares. New York-based Binetti rates them “neutral.”
