Michael Kors (NYSE:CPRI) will release its quarterly report on Tuesday, and investors who've gotten into the high-growth retail company have earned big rewards for their investment. But with the stock trading at an uncomfortably high multiple, Michael Kors earnings need to keep rising sharply in order to keep momentum investors happy with the company's progress.

Kors has given shareholders an amazing growth story, making big headway in what many had considered to be a completely saturated North American market. That leaves the prospect for more aggressive international growth as a potential future driver of even bigger earnings gains in the long run. Let's take an early look at what's been happening with Michael Kors over the past quarter and what we're likely to see in its quarterly report.

Stats on Michael Kors

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$570.52 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

How far can Michael Kors earnings grow this quarter?
Analysts have only gotten more optimistic about the prospects for Michael Kors earnings, boosting their June-quarter estimates by $0.02 per share and adding more than 5% to their full-year fiscal 2014 projections. The stock has kept moving through the roof, giving investors a return of almost 22% since early May.

Kors started off the quarter on the right foot, announcing results for its March quarter with nearly unfathomable comparable-store sales gains of almost 37%. Overcoming the strength of rival Coach (NYSE:TPR), Kors managed to drive sales from its women's handbag collection, but small leather goods also added to volumes and both attracted new customers and boosted purchases from existing customers. The company's partnership with Fossil (NASDAQ:FOSL) also continued bearing fruit, with watch sales rising sharply during the quarter as well.

One question facing Kors is whether weakness in Coach's second-quarter report last week reflects weakness in the overall luxury market or a continued shift away from Coach toward Kors. Thus far, Kors has appeared to take the leadership role away from Coach, squarely emphasizing its lifestyle brand in a way that's been more effective than Coach's strategy. With some key executives leaving Coach, Kors will enjoy the benefit of a solid management team in place to keep continuity in its overall strategic planning.

Moreover, Kors plans to continue executing on what has created such huge success. With plans to add 50 new stores in North America over the next few quarters, Kors believes that it's far from the saturation point domestically, and 35% gains in comps last quarter support that hypothesis. Even more importantly, the company is moving to bring its online business back in-house, putting the margin-enhancing results of that business back onto its financial statements.

In the Michael Kors earnings report, watch for the company to outline the latest tweaks to its business strategy. Whenever Kors decides to focus its attention more squarely on international expansion, investors should prepare for what could be another strong leg up for the stock.

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