Tapestry (TPR) & The Competition Critical Review

Tapestry (NYSE:TPR) is one of 117 public companies in the “Textiles, Apparel & Luxury Goods” industry, but how does it contrast to its competitors? We will compare Tapestry to similar companies based on the strength of its analyst recommendations, valuation, profitability, risk, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for Tapestry and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tapestry	0	5	16	1	2.82
Tapestry Competitors	1657	7665	10089	365	2.46

Tapestry presently has a consensus price target of $167.26, suggesting a potential upside of 26.29%. As a group, “Textiles, Apparel & Luxury Goods” companies have a potential upside of 10.05%. Given Tapestry’s stronger consensus rating and higher possible upside, equities analysts plainly believe Tapestry is more favorable than its competitors.

Dividends

Tapestry pays an annual dividend of $1.85 per share and has a dividend yield of 1.4%. Tapestry pays out 23.8% of its earnings in the form of a dividend. As a group, “Textiles, Apparel & Luxury Goods” companies pay a dividend yield of 3.5% and pay out 23.0% of their earnings in the form of a dividend. Tapestry has raised its dividend for 3 consecutive years. Tapestry lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Institutional and Insider Ownership

90.8% of Tapestry shares are held by institutional investors. Comparatively, 54.1% of shares of all “Textiles, Apparel & Luxury Goods” companies are held by institutional investors. 1.3% of Tapestry shares are held by insiders. Comparatively, 16.1% of shares of all “Textiles, Apparel & Luxury Goods” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Tapestry and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tapestry	19.68%	274.20%	23.66%
Tapestry Competitors	-3.21%	14.02%	2.94%

Earnings and Valuation

This table compares Tapestry and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Tapestry	$8.00 billion	$1.53 billion	17.05
Tapestry Competitors	$5.67 billion	$471.75 million	23.88

Tapestry has higher revenue and earnings than its competitors. Tapestry is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

Tapestry has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500. Comparatively, Tapestry’s competitors have a beta of 0.92, suggesting that their average share price is 8% less volatile than the S&P 500.

Summary

Tapestry beats its competitors on 11 of the 15 factors compared.

About Tapestry

Tapestry, Inc. is a global fashion company whose portfolio includes Coach and Kate Spade New York. The company designs and sells handbags, accessories, footwear, apparel, jewelry and other lifestyle products through retail stores, e-commerce and wholesale partners. Based in New York, Tapestry serves customers in North America and international markets, including Asia and Europe. Its brands reach consumers through company-operated stores and digital channels as well as select department stores and other retail partners.