Why Did VF Corporation’s Stock Price Plunge 6.7% Last Week?



VF Corporation: Disappointing week

VF Corporation (VFC) fell 6.7% last week (August 29 to September 2), despite having no major negative news. The only news pertaining to the company was related to the completion of the sale of its Contemporary Brands businesses to Delta Galil Industries on August 26. The announcement followed a June 2016 news release, in which VF announced that it had entered into a definitive agreement with Delta Galil regarding the sale of these businesses.

VFC’s stock dropped 2.5% on September 2, as Buckingham Research lowered it to a “neutral” from a “buy” rating. Also, the research firm lowered its target price to $60, down from the previous target price of $70.

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Wall Street recommendations

VF is covered by 23 analysts, who have jointly rated the stock as 2.1 on a scale of 1 (strong buy) to 5 (sell). 16 analysts have recommended a “buy,” six have recommended a “hold,” and one analyst has recommended a “sell” on the stock.

VFC’s stock is currently trading at $60, 18.7% below its 52-week high. The stock has been assigned an average target price of $69.22, implying that analysts see shares rising by about 15.3% in 12 months’ time.

Competitors PVH (PVH), Ralph Lauren (RL), and Kate Spade (KATE) have been assigned target prices indicating potential upsides of 8.6%, 3%, and 10.6%, respectively. over the next 12 months.

Target price range

Macquarie has assigned the highest target price, $85, on VFC, indicating an upside of 34%. The broker has given an “outperform” rating on the company.

The lowest target price of $52.50, indicating a downside of 12.5%, was assigned by Morgan Stanley. The broker has given an “underweight” rating on the stock.

About VFC

Established in 1899, VF is the owner of American denim brands Lee and Wrangler. It has a portfolio of approximately 35 brands. The company offers a wide array of products such as casual outerwear, footwear, jeanswear, backpacks, luggage, sportswear, occupational and performance apparel, and others.

ETF investors seeking to add exposure to VFC could consider the SPDR S&P 500 ETF (SPY), which invests 0.12% of its portfolio in VFC. Continue to the next part to learn why Under Armour reported a stock price decline last week.


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