Shares of VF (NYSE: VFC) were getting dinged again this week as the struggling apparel company that owns Vans and North Face got a bearish analyst note.
With Treasury yields rising this week, investor expectations for near-term growth also seem to be weakening -- higher yields are a sign that Federal Reserve rate cuts may not come as fast as some had expected.
As of 1:02 p.m. ET on Thursday, the stock was down 15.2% for the week, according to data from S&P Global Market Intelligence.
Image source: Getty Images.
VF's challenges continue
VF has struggled in recent years as fashion tastes have shifted away from Vans, its leading sneaker brand, and a comeback has been elusive.
According to J.P. Morgan's latest research, investors should expect those challenges to continue as they look ahead to the holding company's earnings report next week. The bank put VF on its "Negative Catalyst Watch." Its research has shown that it continues to face wholesale challenges and that its retail customers are hedging on a warm winter with regards to The North Face, which is best known for its winter wear.
J.P. Morgan maintained a neutral rating on the stock and a price target of $16. A week earlier, Wells Fargo downgraded the stock to underweight saying that its recovery still faced challenges.
What's next for VF Corp.
The apparel company will report earnings next Monday, and analysts are expecting revenue of $2.7 billion, down 12% from the quarter a year ago. They also see earnings per share falling from $0.63 to $0.37.
In the company's most recent quarter, revenue from all four of its major brands, The North Face, Vans, Timberland, and Dickies, all fell, showing how much work it has to do to bounce back.
Given that trajectory, investors should hold off on the stock until there are clear signs of a recovery.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
- Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $20,803!*
- Apple: if you invested $1,000 when we doubled down in 2008, you’d have $43,654!*
- Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $404,086!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.
*Stock Advisor returns as of October 21, 2024
Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Jeremy Bowman has positions in Wells Fargo. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.
