Stock Analysis | Tapestry Outlook - A Strong Technical Picture With Divergent Analyst Views

Market Snapshot

Takeaway: Tapestry (TPR) is showing a strong technical side with an internal diagnostic score of 7.06, suggesting cautious optimism. The stock has risen by 4.97% recently, aligning with positive market expectations.

News Highlights

Recent news highlights include:

• Luxury goods enforcement saw a P15.8 billion counterfeit goods bust in the Philippines, potentially impacting Tapestry's brand value in the region.
• American Catholics and luxury trends suggest shifting demand patterns, with Trump's trade policies influencing import prices and consumer behavior globally.
• Washington state imposes a 10% tax on luxury aircraft, indicating growing regulatory scrutiny on high-end products, which could indirectly affect Tapestry's market dynamics.

Analyst Views & Fundamentals

Tapestry is receiving 7 "Buy" and 3 "Neutral" ratings from analysts in the last 20 days. The simple average rating score is 3.70, while the performance-weighted rating is 4.88. Despite the divergence in views, the current price trend of a 4.97% rise aligns with the optimistic expectations.

Key fundamental metrics and their internal diagnostic scores (0-10):

• EV/EBIT: 136.07 (Score: 3.00)
• Profit-MV: -1.14 (Score: 1.00)
• PE: 79.53 (Score: 1.00)
• Total profit YoY growth: -11.00% (Score: 0.00)
• Cash-UP: 1.36 (Score: 2.00)
• NPM: 14.14% (Score: 0.00)
• EBIT / Total operating revenue: 16.91% (Score: 0.00)

While there are some mixed signals in the fundamentals, the internal diagnostic scores suggest that key metrics are either neutral or bearish.

Money-Flow Trends

Big-money investors are cautiously watching the stock, as overall fund flow shows a negative trend with an overall inflow ratio of 0.4790 and an internal diagnostic score of 7.90. This suggests that institutional investors are not aggressively pushing into the stock, while retail investors remain relatively neutral, with small, medium, and large inflow ratios also trending negatively.

Key Technical Signals

Tapestry's technical indicators show a strong bullish bias with the following key signals:

• Long Upper Shadow and Dividend Announcement Date each have internal diagnostic scores of 8.13, suggesting strong bullish momentum.
• Earnings Release Date also carries a score of 8.13, reinforcing the positive outlook ahead of key dates.
• On August 14, the stock showed strong indicators including Long Upper Shadow, WR Oversold, and Dividend Announcement Date, signaling a potentially volatile and event-driven period.
• Overall, the technical indicators suggest cautious optimism, with strong bullish signals outpacing bearish ones (5 vs. 1), though the market remains volatile.

Conclusion

Tapestry is in a technically strong position with bullish indicators and positive market expectations. However, the fundamental score of 3.71 and mixed analyst views suggest caution. Investors may want to watch the upcoming earnings and dividend dates for further clarity, and assess if the stock can sustain its current momentum amid conflicting fundamentals.