Janney Starts Michael Kors (KORS) at Buy; Co. Called 'Powerhouse'

Janney Montgomery Scott initiated coverage on Michael Kors (NYSE: KORS) with a Buy rating and a price target of $121.00.

"Our BUY thesis is based on the following: 1) highly compelling, growing, and relatively price-insulated aspirational luxury and accessories market, 2) one of the fastest growing brands with ample global opportunity, as well as ongoing positive comp momentum, 3) a multi-faceted business with wholesale, licensing, retail, and both domestic and global opportunities, and 4) sustainable 20% to 25% top-line and 25% to 30% bottom-line
growth," said analyst Adrienne Tennant.

"KORS has been a growing and increasingly dominant brand in the aspirational luxury and accessories marketplace, with positive double digit comps since 2007 (excluding 2009) and fifteen consecutive quarters of comps greater than 20%. Competitively, we believe KORS presents consumers with exceptional value, with fashion-leading designs at accessible entry price points. We also point out that the Kors brand resonates globally with customers, particularly in the U.S., due to Michael Kors’ success as a leading runway fashion designer, with an over 30+ year career in the fashion industry. In addition to the Michael Kors runway collection, the MICHAEL by Michael Kors and KORS by Michael Kors lines were launched in 2004. KORS is considered the mid-tier line, between the runway and MICHAEL collections. Despite the relatively expensive valuation attributed to shares of KORS versus the sector average, we point out the strength, and visibility, of the longer-term top- and bottom-line growth. As such, we believe KORS is still a highly investable stock, even at current prices," she added.

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

Shares of Michael Kors closed at $88.17 yesterday.

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