Coach (NYSE: COH) is on fire. The upscale accessories company once known for its conservative leather handbags has undergone an image and product transformation over the last two years. Some might say it's gone from country club stodgy to chic fashionista fabulous, and, well, that's not far from the truth.

Coach affirmed its prosperity today, raising estimates for its second quarter ended Dec. 28. Back in October, it expected to earn $0.61 per share for the quarter. Now it intends to pull in at least $0.65, well above the current $0.62 analysts had anticipated.

A standout among specialty retailers, Coach had an amazing holiday season. Sales for the second quarter were up 30% to $308.5 million. Originally, it expected sales to come in around $290 million, which still would have been a great gain over the previous quarter's sales of $235.8 million.

Same-store sales jumped 12.7%, with retail comps up 18.1%, and factory store comps up 5.8%. Indirect sales, or sales of its products through intermediaries such as department stores and international locations, were up 55.5%.

An iffy economy and weak consumer spending haven't kept Coach down. Demand for its products, driven in large part by the incredibly successful Signature Collection and the newly introduced Ergo Collection, has been stronger than ever. It has also introduced other goods in addition to handbags -- hats, shoes, and myriad small items -- that have been strong performers. Its designs, colors, and general sense of what's fashionable have been without flaw over the last two years.

Things aren't only exciting for Coach here in the U.S., either. Japanese buyers have developed a nearly insatiable taste for its products. Significant sales growth in Japan helped Coach's indirect sales growth substantially. The company is expected to double its share of that market, which currently is just 2% to 3%, over the next several years. That still leaves a vast amount of territory there for it to conquer.

Continued strength in the domestic market, as well as further growth in Japan, will spell even more success for Coach. Shares might be getting ahead of themselves, though, having nearly doubled off their 52-week low, and now trading at 26 times current fiscal-year earnings. Then again, perhaps it's too much to expect a bargain price for a company that sells products that are anything but.