Taking a look at the companies 8-K report, we can gather how their latest numbers are. Second quarter net sales increased 4% over prior year despite North America wholesale strategic repositioning. Coach Brand North America comparable store sales increased 3% in the second quarter. Lastly, second quarter GAAP EPS was $0.71 versus $0.61 a year ago, up 16%. For a brand that might be facing stiffer competition, these numbers are reassuring for investors and potential investors alike.
Now, taking a look at the chart using the monthly time frame, we can see that price is chilling at the current levels and hasn’t moved much in the recent months. This is not worrying because this could be where the market thinks price should be given the fundamental data. If you want to see a larger move, keep an eye out for out of the ordinary reports and numbers that might cause the chart to swing one way or another. Overall, the chart looks well and nothing stands out, but be sure to compare all of the data from the chart and fundamentals to get the best overall picture.
How important is Coach's Liquidity
Coach
financial leverage refers to using borrowed capital as a funding source to finance Coach Inc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Coach financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Coach's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Coach's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the
breakdown between Coach's total debt and its cash.
A Deeper look at Coach
Risks
For a full list of risks, take a look at the most recent 10-K report as this will give you details on the risks. For now, here are a couple to keep in mind while doing your research. First, the company faces intense competition, which means they have to uphold high customer service and product standards. If those slack, people will go to a competitor to buy their items. Secondly, if the overall market slows, people will slow down in purchasing these types of items. If people stop buying, sales and the stock price will fall, hurting current and potential investor prospects.
Conclusion
I would certainly compare this company to others in the market to fund which one is giving you the best value. There are many factors to weight and this will take time to research and fully understand. If after your own research you still have questions, consult an investing professional and they can help point you in the right direction.
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Nathan Young is a Senior Member of Macroaxis Editorial Board - US Equity Analysis. With years of experience in the financial sector, Nathan brings a diverse base of knowledge. Specifically, he has in-depth understanding of application of technical and fundamental analysis across different equity instruments. Utilizing SEC filings and technical indicators, Nathan provides a reputable analysis of companies trading in the United States.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Nathan Young do not own shares of Coach Inc. Please refer to our
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