Stock Analysis | Tapestry Outlook - A Bullish Technical Picture With Mixed Fundamentals

Market Snapshot

Market trend: Rising by 1.86%, with analysts showing a cautious but optimistic stance. The stock has attracted a mix of bullish and neutral ratings, showing a fragmented consensus.

News Highlights

Recent news suggests both challenges and opportunities in the luxury goods and real estate markets:

• May 26, 2025 - A massive P15.8 billion worth of counterfeit luxury goods was seized in the Philippines. While this highlights ongoing issues with brand protection for companies like Tapestry, it may also reflect rising demand for real luxury products.
• May 30, 2025 - Hyatt introduced a new lifestyle brand, Unscripted by Hyatt, targeting travelers seeking authentic experiences. This aligns with the broader luxury trend of personalization and exclusivity, potentially benefiting Tapestry's brands like Coach and Kate Spade.
• May 29, 2025 - LVMH, the world’s largest luxury brand, hinted at possible price increases to offset US tariff impacts. This could ripple across the luxury market, including Tapestry’s product lines.

Analyst Views & Fundamentals

Analysts are split, with 7 "Buy" ratings and 3 "Neutral" ratings in the past 20 days. This indicates a generally optimistic outlook, but with some caution. The simple average rating is 3.70, and the performance-weighted rating is 4.88. These scores suggest a mildly bullish bias, though not all institutions agree.

Key Analysts and Their Performance

• Dana Telsey (Telsey Advisory Group) - Historical winning rate of 81.8%. Her recent "Buy" ratings add strong credibility to the bullish side.
• Ike Boruchow (Wells Fargo) - With an 83.3% historical winning rate and a recent "Buy", his input is particularly strong.
• Michael Binetti (Evercore ISI Group) - 100.0% historical winning rate in the last 30 days, further reinforcing the bullish sentiment.
• Lorraine Hutchinson (B of A Securities) and Alexandra Steiger (Morgan Stanley) are more cautious or have weaker records, but their views are less impactful given lower activity levels.

Fundamental Factors

Here are the most significant fundamental factors, along with their internal diagnostic scores (0-10) and values:

• EV/EBIT = 136.07 - Internal diagnostic score: 2.0
• PE = 79.53 - Internal diagnostic score: 1.0
• Profit-MV = -1.14 - Internal diagnostic score: 2.0
• Cash-UP = 1.36 - Internal diagnostic score: 2.0
• Annualized Net Profit Margin on Total Assets = 9.63% - Internal diagnostic score: 1.0
• Net Profit Margin (NPM) = 0.14% - Internal diagnostic score: 0.0

While Tapestry has decent cash and asset positions, its profitability metrics are weak. This mismatch between technical strength and weak fundamentals creates a cautious investment environment.

Money-Flow Trends

Big-money flows are currently negative, with an overall inflow ratio of 47.6%, suggesting caution among institutional investors. Retail investors are also cautious, with a Small-inflow ratio of 49.9%. This implies a relatively balanced outflow at both ends, but the negative sentiment remains.

• Large-inflow ratio: 48.0%
• Extra-large-inflow ratio: 46.6%

The fund-flow score is 7.88 (on a 10-point scale), indicating a "good" overall flow pattern, but not strong bullish support.

Key Technical Signals

Tapestry’s technical indicators are mostly bullish, with 6 out of 8 indicators showing strength. The technical score is 7.18 (internal diagnostic score), indicating a "strong, cautious, and optimistic" trend. Here are the most influential indicators:

Indicator Breakdown

• Long Upper Shadow (8.13) - A strong bullish signal, suggesting price resilience and buying pressure.
• Dividend Announcement Date (8.13) - Historical data shows a 75% win rate and an average return of 2.03%.
• Earnings Release Date (8.13) - Strong bullish signal, with similar performance as the dividend event.
• WR Overbought (6.7) - A neutral-to-bullish indicator, suggesting a possible pullback is ahead.
• Long Lower Shadow (3.59) - A bearish signal with a win rate of only 50%, indicating potential weakness.

Recent Chart Patterns

• August 14, 2025 - Long Lower Shadow and Long Upper Shadow both appeared, suggesting conflicting momentum signals.
• August 26, 2025 - A Marubozu White pattern was observed, indicating strong bullish momentum.

This mixed signal suggests that while Tapestry has strong upward potential, it may face volatility and pullbacks in the short term.

Conclusion

Tapestry (TPR) has a bullish technical outlook with a strong score of 7.18 and several positive signals like the Long Upper Shadow and earnings/dividend announcements. Analysts are mostly optimistic, with several top-rated institutions backing the stock. However, fundamentals are weak, particularly in profitability metrics. Money flows are mixed, with a cautious institutional stance.

Actionable takeaway: Investors should watch upcoming earnings and dividend announcements, as these events historically drive strong returns. Consider entering on a pullback after a potential overbought correction or after strong fundamental data confirms the technical strength.