By Sammy Pollack:
Despite a strong stock market and luxury retail environment, shares of Coach (COH) have struggled over the past two years. At the same time, as shown by the chart below, shares of COH competitors Michael Kors (KORS) and Kate Spade & Co (KATE) have moved sharply higher.
COH data by YCharts
Declining Sales
COH's most recently reported quarter was nothing short of abysmal. COH reported a 16% drop in profit and a sales decline of 5.6%. North American sales fell by more than 13% while margins declined from 72% to 69.2%. Weak sales numbers are the result of COH losing share to competitors such as KORS and KATE. However, lower earnings estimates have now been factored into COH shares. Any player interested in buying COH would need a plan to turnaround the U.S. business. I view COH's struggling U.S. business as an opportunity for a buyer to make
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