Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why Michael Kors Stock Was Flying Higher

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our thesis.

What: Shares of Michael Kors Holdings Limited (NYSE: KORS  ) were looking as stylish as ever, climbing as much as 22% and finishing up 17% after another blockbuster earnings report today.

So what: The fashion house was strutting its stuff down the runway once again, posting earnings per share of $1.11 on expectations of $0.86, while revenue jumped 57% to $1 billion, crushing estimates of $860 million. Comparable sales also sped ahead 28%, showing that growth came both organically and through expansion. The report was all the more impressive considering many retailers had complained of a poor holiday selling season, but Kors clearly thrived in spite of the broader weakness. CEO John Idol said the company had an "outstanding holiday season."

Now what: Perhaps most indicative of Kors' dominance and brand power is its huge operating margin, which hit 33.9% last quarter, an improvement over 32.2% a year ago. That's a sign of pricing power, and it's exactly what investors want to see in a high-end brand like Michael Kors. Fashion is notoriously fickle, but Kors is indisputably a company on the rise as it consistently blows earnings estimates out of the water. Even though shares are up over 60% in the past year, I'd expect them to keep moving north.

What else is changing in retail
To learn about two retailers with especially good prospects, take a look at The Motley Fool's special free report: "The Death of Wal-Mart: The Real Cash Kings Changing the Face of Retail." In it, you'll see how these two cash kings are able to consistently outperform and how they're planning to ride the waves of retail's changing tide. You can access it by clicking here.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2823559, ~/Articles/ArticleHandler.aspx, 8/28/2015 6:18:23 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Jeremy Bowman

Fool since 2011. I write about consumer goods, the big picture, and whatever else piques my interest. Follow me on Twitter to see my latest articles, and for commentary on hot topics in retail and the broad market.

Today's Market

updated Moments ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/28/2015 4:03 PM
KORS $43.17 Down -0.11 -0.25%
Michael Kors Holdi… CAPS Rating: ****