Capri Holdings (CPRI – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Lorraine Hutchinson from Bank of America Securities maintained a Hold rating on the stock and has a $23.00 price target.
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Lorraine Hutchinson’s rating is based on several factors, primarily revolving around Capri Holdings’ uncertain growth prospects and strategic adjustments. During the 2025 Investor Day, Capri management reiterated their revenue and operating margin targets for fiscal years 2025 and 2026, while introducing new long-term targets. However, there is skepticism regarding the company’s ability to achieve the projected 7% year-over-year growth in fiscal year 2027, as this is significantly higher than the consensus estimate of 3%. This uncertainty, combined with expectations of another challenging year in fiscal 2026, has led to a more cautious outlook.
Furthermore, the turnaround efforts at Michael Kors are still in their early stages, with key initiatives focusing on product assortment and marketing strategies. The company is adjusting its pricing strategy, which has previously led to pricing out core consumers and increased markdowns. Although these changes create short-term headwinds, they are expected to better position the company for long-term success. Additionally, the management’s ambitious goal of achieving high-teens operating margins relies heavily on expense leverage and strategic cost reductions, which are contingent on a successful sales rebuild. These factors contribute to the hold rating, balancing potential recovery with near-term challenges.
In another report released today, TD Cowen also maintained a Hold rating on the stock with a $22.00 price target.