Luxury retailer Coach (NYSE: COH ) released fiscal first-quarter earnings this morning, and reported smaller-than-expected profits and sales growth. Investors have bid shares down as much as 8% following the news.
Profit fell 1.6% for Coach, and sales at North American stores open for one year or more dropped 6.8%. While the same-store sales decline was expected, analysts had estimated a significantly smaller 2.9% decrease. Competition in the luxury goods space is heating up, especially from recent upstarts like Michael Kors.
Coach investors reacted similarly to last quarter's earnings announcement on July 30, which sent shares down as much as 10% in intraday trading. Motley Fool analyst Jason Moser remains confident in the long-term value of the stock, noting that retail generally is underperforming, and that economic uncertainty is likely contributing to lower-than-expected sales. Additionally, Coach is doing well internationally, and Jason expects to see good things from the recent management transition going forward.
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