Jefferies and Piper Jaffray Downgrade Shares of Coach (COH); CEO Comments on Outlook

July 31, 2012 9:41 AM EDT
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Price: $35.08 --0%

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Jefferies and Piper Jaffray downgrades shares of Coach (NYSE: COH) this morning, despite the company reporting Q4 earnings that topped estimates by $0.01. Revenues were slightly below expectations, coming in at $1.16 billion vs. $1.20 billion.

On guidance, Coach's CEO said, "As we look forward to FY13, we are mindful of balancing the impact of the muted consumer environment in North America and a softening global macroeconomic outlook with our optimism around the launch of Legacy, Men’s and the strong international expansion opportunities for Coach. Additionally, FY13 will be an investment year, as we amplify our actions to drive long-term growth. Most significant is our acceleration of the acquisition of the domestic retail operations of key Asian distributors – including those in Malaysia and Korea in the first quarter - and the further development of the infrastructure to support our global growth. In addition, we’re distorting investments in the digital space to strengthen our capabilities and deepen our engagement with consumers. We expect that together these investments will result in modest deleverage in FY13."

Jefferies lowers COH from Buy to Neutral, PT $55.

Piper Jaffray cut COH from Overweight to Neutral. PT $67.

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