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On Wednesday, Truist Securities adjusted its outlook on VF Corp (NYSE:VFC) shares, reducing the price target from $24.00 to $13.00 while maintaining a Hold rating. The change comes as VF Corp’s popular brand Vans™ witnessed a decline in sales, with topline trends showing a 20% drop in constant currency during the fourth fiscal quarter. Management’s efforts to reset the brand accounted for approximately 60% of this downturn. According to InvestingPro data, VF Corp’s revenue declined 2.5% in the last twelve months, with analyst consensus suggesting further sales weakness ahead.
Truist Securities highlighted that VF Corp’s management is effectively implementing its Reinvent strategy, particularly in terms of cost management, and is on track to meet its mid-term savings goals. Despite these efforts, the securities firm anticipates that the brand reset initiatives are likely to continue affecting the company’s performance negatively in the first half of 2026. InvestingPro analysis indicates the company maintains strong liquidity with a current ratio of 1.56, though its Financial Health Score stands at "FAIR."
The analyst from Truist Securities expressed a cautious stance, noting that while management’s execution is commendable, the path to a Vans turnaround appears lengthy and uncertain. The firm has decided to remain neutral until there are more definitive signs of sustained topline growth.
VF Corp’s shares experienced a low double-digit percentage drop as investors reacted to the soft sales performance of Vans™. The ongoing brand reset efforts, although strategic, are expected to present similar challenges in the near term.
The price target adjustment reflects the current challenges faced by VF Corp and sets a new valuation benchmark for the company’s stock. Truist Securities advises investors to await clearer indicators of a robust and lasting improvement in sales before changing their stance on VF Corp shares.
In other recent news, VF Corporation announced its fourth-quarter financial results for 2025, reporting a 3% decline in revenue year-over-year to $2.1 billion and an adjusted loss per share of $0.13. Despite the revenue drop, the company managed to improve its gross margin by 560 basis points to 53.4%, indicating operational efficiencies. Looking ahead, VF Corp expects a further revenue decline of 3-5% for the first quarter of fiscal 2026. Needham analysts have maintained a Buy rating on VF Corp but reduced the price target to $15, citing challenges with the Vans brand, which saw a 20% revenue decline. Similarly, JPMorgan also lowered its price target to $15 while maintaining a Neutral rating, highlighting VF Corp’s anticipated operating loss and lower-than-expected EBIT margin for the upcoming quarter. The company’s ongoing global reorganization, including a reduction of approximately 400 employees, aims to save costs and expand net operating income by $500-600 million. Despite these challenges, VF Corp expects an increase in EBIT for the full fiscal year 2026 and projects free cash flow to rise modestly from the previous year’s $313 million.
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