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VF Corporation: In-Line Earnings, Misses on Revenues in Fiscal 4Q16

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Series snapshot

VF Corporation (VFC) reported its results for fiscal 4Q16 and fiscal 2016 on February 17, 2017. The results relate to the three-month period ended January 31, 2017.

The company reported in-line earnings but missed on Wall Street revenue estimates during fiscal 4Q16. VFC’s earnings per share (or EPS) increased 2.1% to $0.97 while its total revenues fell 3.6% YoY to ~$3.3 billion. Despite mixed results, VF Corporation stock jumped 4.6% to close at $52.68 on February 17. VF Corporation is currently sitting on a YTD (year-to-date) loss of ~1.3%.

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Valuations summary

VF Corporation (VFC) is trading at a one-year forward PE (price-to-earnings) ratio of 17x, operating in the middle of its 52-week PE range of 14.9x–20.6x.

VFC is trading at a premium to PVH Corp (PVH), Gap, Inc. (GPS), and Hanesbrands (HBI), which are trading at 12.7x, 11.8x, and 10.6x, respectively.

VFC stock offers a dividend yield of 3.3%, which is better than the dividend yields of PVH Corp, at 0.2%, and Hanesbrands, at 2.7%. However, VFC’s dividend yield is lower than the dividend yield of 3.8% for GPS.

About VF Corporation

Established in 1899, VF Corporation is one of the largest apparel companies in the world. The company owns iconic American denim brands Lee and Wrangler and has a portfolio of about 35 brands. The company’s segments include Casual Outerwear, Footwear, Jeanswear, Backpacks, Luggage, Sportswear, Occupational Apparel, and Performance Apparel.

With a market capitalization of $21.8 billion on February 17, 2017, VF Corporation has a weight of 1.9% in the ProShares S&P 500 Dividend Aristocrats ETF (NOBL).

Looking ahead

In this series, we’ll provide an earnings overview of VF Corporation’s fiscal 4Q16 results. We’ll discuss the company’s financial performance during fiscal 4Q16 and fiscal 2016, review the key revenue drivers and profitability, and discuss Wall Street’s view on VFC. We’ll also evaluate the company’s stock market performance and look at its current valuation.

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