Cowen analyst, Oliver Chen, cut his price target on Fossil (NASDAQ: FOSL) to $41 from $42 and maintained his Market Perform rating since new guidance implies a second half inflection point. Acknowledging the opportunity for connected devices, he is waiting for visibility on new product adoption.

For 1Q, he is modeling GAAP EPS of $0.11E, assuming net sales down -8.7% (-6.5% C/C), with op margin at 1.5%. He is modeling FY16 GAAP EPS of $3.10E on sales declining -2.5% y/y (-1.6% C/C) and op margin at 7.0%.

Management commented that the connected accessories launch creates a broader addressable market for FOSL, as the wearables technology market reached an est. $10bn-$15bn, on top of a $65bn in traditional watches. Given this, FOSL focused on building momentum with 4 key strategic priorities:

1) drive cont'd share gains in the traditional watch market by investing & growing own brands, Fossil and Skagen

2) invest in digital capabilities to improve online experience & Omni-channel

3) continue to optimize & enhance FOSL's portfolio of brands

4) build presence in the connected accessories category by leveraging Misfit across its portfolio of brands

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 $34.46 yesterday.