Piper Jaffray Cuts Price Target on Fossil Group (FOSL) on Continued Market Concerns

Piper Jaffray reiterated an Underweight rating on Fossil (NASDAQ: FOSL), and cut the price target to $46.00 (from $53.00), as global market concerns continue.

Analyst Erinn Murphy commented, "In view of our continued caution around the traditional watch category, the increasingly competitive landscape into 2016 and the recent volatility in the consumer trends in Asia, we are reducing our estimates. We see gross margin pressure further ensuing into FY16 as competition in the wearable space unfolds. Real time, China's Golden Week which kicked off October 1 has been tepid thus far and luxury brands in Hong Kong are describing it as the worst on record. Fossil generates 16% of sales in AsiaPac. Furthermore, we see unit cannibalization as on-going in the traditional watch space as wearables continue to take "wrist share". We are already seeing the steepest unit decline in the Swiss watch export data in the 200-500 CHF range which was down 24% Y/Y in Aug. Our PT moves to $46 following our FY16 EPS revision to $4.60."

For an analyst ratings summary and ratings history on Fossil click here. For more ratings news on Fossil click here.

Shares of Fossil closed at $55.38 yesterday.

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