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Why Coach's Shares Came Back in Style

By Travis Hoium - Apr 23, 2013 at 4:45PM

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Is this meaningful or just another movement?

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 investing thesis.

What: Shares of Coach (TPR -4.03%) jumped 10.5% today after the company released earnings.

So what: First-quarter sales rose 7% to $1.19 billion, beating estimates of $1.18 billion. On the bottom line, earnings per share jumped 10% to $0.84, four cents ahead of estimate.  

Now what: The big highlight was a 40% increase in China's sales, continuing strong growth internationally. North America, which accounts for two-thirds of sales, also saw a 7% increase in sales during the quarter. I don't see the earnings beat as a reason to pay 10% more for the company, but if shares fall over the next few weeks, investors can get in at a good value, especially after management increased its dividend to $1.35 per share annually.

Interested in more info on Coach? Add it to your watchlist by clicking here.

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