2-Star Stocks Poised to Plunge: Michael Kors?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, branded apparel and accessories company Michael Kors Holdings (NYS: KORS) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Michael Kors' business and see what CAPS investors are saying about the stock right now.
Michael Korsfacts
Headquarters (founded) | Tsim Sha Tsui, Hong Kong (1981) |
Market Cap | $10.4 billion |
Industry | Apparel, accessories and luxury goods |
Trailing-12-Month Revenue | $1.5 billion |
Management | Chairman/CEO John Idol Honorary |
Trailing-12-Month Return on Equity | 58.1% |
Cash/Debt | $162.1 million / $27.7 million |
Competitors | Calvin Klein |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 21% of the 158 members who have rated Michael Kors believe the stock will underperform the S&P 500 going forward.
Earlier this month, one of those Fools, sikiliza, tapped Michael Kors as a solid company selling at a rather risky valuation:
Michael Kors is a good brand and selling at prices that the average Joe can afford. That and the continued acquisition of floor space across retail stores indicates that it's gaining momentum. Further, 30% growth in Europe while Euro zone GDP fell 0.2% in Q2-2012 is testament to the brand's strength.
That said, I have seen this story before in the case of [Aeropostale]. That did not end well. Given [August 14th's] jump in the stock price, I am taking a short term bearish outlook to the stock until it reverts to mean market performance.
If you want market-thumping returns, you need to protect your portfolio from any undue risk. Luckily, we've found another retailer we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.
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The article 2-Star Stocks Poised to Plunge: Michael Kors? originally appeared on Fool.com.
Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Aeropostale. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
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