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On Wednesday, Wells Fargo (NYSE:WFC) analyst Ike Boruchow upgraded VF Corp (NYSE:VFC) stock from Underweight to Equal Weight, while reducing the price target to $12 from $18. Boruchow stated that the bear case for VF Corp, a leading apparel and footwear company, appears to have fully materialized. According to InvestingPro data, VFC stock has declined over 45% year-to-date, with particularly high price volatility. He noted that VF Corp has been one of the poorest performers in its sector, but believes that the market has now completely factored in the delayed turnaround of its Vans brand.
The analyst pointed out that while there are still concerns about VF Corp’s balance sheet and free cash flow (FCF), the risk/reward profile has become more balanced, prompting a shift to a neutral stance. InvestingPro data shows the company maintains a current ratio of 1.56, with liquid assets exceeding short-term obligations. According to Boruchow, the revised price target of $12 is based on approximately 11 times the estimated earnings per share (EPS) for the fiscal year 2027.
Boruchow also provided a downside scenario, where VF Corp’s stock could drop to $8, which he describes as a "recessionary" multiple of 8 times his bear case of $1.00 in EPS for FY27. On the flip side, he sees an upside potential where the stock could reach $18, based on a 15 times recovery multiple on a slight upside to his base case for FY27.
The upgrade reflects a change in sentiment toward VF Corp, suggesting that the previous concerns have been acknowledged and priced in by investors. The new price target implies a more conservative outlook on the company’s financial performance in the near future.
In other recent news, VF Corp has reported several significant developments. Citi analysts downgraded VF Corp’s stock from Buy to Neutral, reducing the price target from $30.00 to $12.00. This decision was influenced by concerns over the company’s ability to revitalize its Vans brand and adjustments in earnings estimates. Citi revised its earnings projections for fiscal years 2026 and 2027, lowering them to $0.77 and $0.70 per share, respectively, while also forecasting a sales decrease and contraction in EBIT margins. Meanwhile, VF Corp has appointed Abhishek Dalmia as Executive Vice President and Chief Operating Officer, aiming to enhance its leadership team and operations. Additionally, VF Corp’s board accepted the resignation of director W. Rodney McMullen, reducing the board size from thirteen to twelve members. Stifel analysts maintained a Buy rating on VF Corp shares with a $35.00 price target, highlighting growth potential in The North Face and Timberland brands. Stifel emphasized VF Corp’s strategic plans and cost-saving initiatives as factors that could lead to margin leverage and a return to growth.
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