Shares declined nearly 16% on Thursday after the retailer issued a weak forecast.
Tapestry Inc.’s stock rose 0.2% in early premarket trading on Friday, following its worst drop in over two years in the previous session.
Analysts remained optimistic about the luxury brand, even after the Coach parent’s weak outlook issued on Thursday. Retail investors went a notch further, placing an ‘extremely bullish’ sentiment on the shares on Stocktwits.
Wells Fargo kept its ‘overweight’ rating on Tapestry stock and raised its price target to $120 from $100, recommending investors to buy the shares after the dip.
The first-quarter guidance is “actually extremely bullish,” and there is “no real fundamental concern here,” the research firm said in a note, reported by The Fly.
Tapestry forecast fiscal 2026 revenue and adjusted profit below Wall Street expectations, sending its shares down nearly 16% on Thursday. Its fourth-quarter results beat expectations.
Bank of America trimmed its price target by $5 to $110. Concurring with Wells Fargo analysts’ view, BofA stated that Tapestry’s sales momentum remains very strong the Coach brand has several more quarters of outsized growth ahead.
Results showed that Coach continued its strong run, with revenue rising 13% in the fourth quarter ending in June and 10% for the financial year. Sales of Kate Spade and Stuart Weitzman declined in both the fourth quarter and the fiscal year 2025.
Meanwhile, Tapestry’s China business has rebounded even as other consumer goods firms struggle in the region. Revenue in the region rose 18% for the second consecutive quarter.
“We powered global growth, delivering accelerated gains and outpacing the industry in our key regions of North America, China, and Europe,” CEO Joanne Crevoiserat said on the earnings call, adding that the company’s push on direct-to-consumer marketing and technology is partly driving the gains.
Crevoiserat said the strong brand recall, mainly for its Coach brand, and global footprint would drive growth despite economic challenges.
Currently, 15 of the 20 analysts covering the stock have a ‘buy’ or higher rating, four rate ‘hold,’ and one rates ‘sell,’ according to Koyfin data. Their average price target is $95.96, around the same level as the stock’s last close.
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