JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
On Thursday, Bernstein analysts maintained their Market Perform rating and $20.00 price target for Capri Holdings (NYSE:CPRI), following the company’s fourth-quarter results. The luxury fashion group, currently valued at $2.13 billion, reported a top-line beat but a slight miss on earnings before interest and taxes (EBIT) for the quarter. According to InvestingPro data, the company maintains impressive gross profit margins of nearly 64%, despite facing a 12.3% revenue decline in the last twelve months.
Capri Holdings, known for its portfolio of luxury brands including Michael Kors, Versace, and Jimmy Choo, delivered a message of positive medium-term earnings growth as part of its ongoing multi-year turnaround efforts. Management highlighted expectations for top-line growth, margin improvements, and benefits from a healthy buyback program supported by a strong balance sheet. InvestingPro analysis reveals 8 additional key insights about Capri’s financial health and growth prospects, available to subscribers.
Looking beyond fiscal year 2026, the company’s management expressed optimism about returning to mid-single-digit percentage top-line growth, with consistent margin enhancements resulting from increased full-price sales and operational leverage. Additionally, the anticipated sale of Versace is expected to provide a significant cash infusion, allowing for the paydown of existing debt and an accretive buyback strategy.
While Bernstein analysts appreciate the medium-term growth algorithm and the direction in which Capri Holdings is heading, they remain cautious due to short-term uncertainties and the early stages of some of the company’s strategies, such as average unit retail (AUR) and rebranding initiatives. They emphasize the need for further evidence of traction in the upcoming quarters before declaring the turnaround a success.
In other recent news, Capri Holdings has reported a fourth-quarter earnings per share loss of $4.90, significantly missing analyst expectations. The company’s fiscal year 2026 guidance has been revised, with projected revenue now between $3.3 billion and $3.4 billion, a decrease due to the reclassification of Versace as a discontinued operation and tariff impacts. Additionally, Capri Holdings has entered into a definitive agreement to sell the Versace brand to Prada (OTC:PRDSY) for $1.375 billion, a move expected to close in the second half of 2025. Analysts from Bernstein view this divestiture as a strategic step that allows Capri to focus on its core brand, Michael Kors, and reduce debt.
In terms of analyst ratings, BofA Securities has reduced Capri Holdings’ price target to $21, maintaining a Neutral stance, while Jefferies has raised its target to $17, keeping a Hold rating. UBS has retained a Neutral rating with a $14 price target, noting the potential for significant stock price movement depending on future earnings guidance. Jefferies also highlighted Capri’s cost-saving measures and net interest income as factors that could cushion earnings per share. The anticipated proceeds from the Versace sale are expected to help reduce Capri’s debt, with potential future share buybacks acting as a catalyst for the company.
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