Though Coach still has plenty of ground to cover, it has nonetheless made strides in its efforts to shed its reputation as a mass brand. By expanding its reach into select higher-price offerings, including its luxury 1941 label, Coach will soon be sold in high-end stores that haven't traditionally offered its brand, including Nordstrom and Saks.
The company has also shifted away from its ubiquitous logo bags, which now make up less than 5 percent of its sales at Coach-branded retail shops in North America, and less than 30 percent at its outlet locations. Meanwhile, it has pulled back on the number of online sales it offers during each quarter.
What's more, its redesigned stores — which are expected to make up 40 percent of its fleet by the end of the fiscal year in June — continue to outperform the others.
As a result, management reiterated its forecast that the brand will post positive domestic comparable sales during the fourth quarter. That would be the first time it's done so in more than three years.
"The key takeaway following the [second-quarter] print is that the turnaround at Coach continues," said Jefferies analyst Randal Konik, who has a "buy" rating and $51 price target on the brand.
The stock closed near $33. Despite the day's gains, Coach shares are down more than 9 percent over the past year.
Correction: This story has been updated to give the correct stock price for Coach on Tuesday.