Coach Profit Up, But Shares Sag on Outlook
High-end accessory maker Coach reported higher quarterly profit Tuesday, but its shares fell more than 8 percent as its outlook for the current period came in below analysts' estimates.
Coach Chief Executive Lew Frankfort said he was concerned about weak consumer traffic at the company's U.S. stores, particularly in the past several weeks.
Net income rose to $154.8 million, or 41 cents per share, in the first quarter that ended on Sept. 29 from $125.6 million, or 34 cents a share, a year earlier.
Analysts on average were expecting 40 cents a share, according to Reuters Estimates.
Net sales increased 28 percent to $677 million from $529 million.
The New York-based company, which makes handbags, shoes, wallets and other accessories, stood by its fiscal 2008 forecast of at least $2.06 per share.
However, Coach raised its sales outlook slightly to $3.17 billion from $3.16 billion it had forecast in July.
Analysts were expecting $2.08 per share on $3.19 billion in sales, according to Reuters Estimates.
For the current quarter, Coach said it expected earnings of 68 cents per share on sales of about $970 million. Analysts were expecting 70 cents a share on sales of $983.6 million.
The company said it expected sales at U.S. retail stores open at least a year to rise at a low single-digit percentage rate for the quarter.