Kate Spade & Co.'s (KATE) 3Q Earnings and Comp Beat are Consistent with 2015 Survey; Mizuho Securities Reiterates Buy
Mizuho Securities reiterated a Buy rating and $30.00 price target on Kate Spade (NYSE: KATE) following the company's 3Q earnings beat. The beat demonstrated comp acceleration that is consistant with 2015 surveys. KATE continues to lay the foundation for China while demonstrating sequential improvement in Japan, adding 5 new European countries, and expansion into Latin American with a Panama store.
Analyst Betty Chen commented, "With a 3Q beat that demonstrated another quarter of sequential comp acceleration, consistent with takeaways from our Fall 2015 Handbag survey, we continue to recommend KATE shares given ongoing market share gains in the handbags and accessories category despite pulling back on promotions. With increasing wholesale door productivity and BTE full price sell throughs online, we see broadening awareness via domestic and International channels and product extensions as additional proof of management’s strategy to evolve into a $4bn lifestyle brand while raising EBITDA profile."
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Shares of Kate Spade closed at $19.74 yesterday.