Tapestry (NYSE:TPR) has released its fiscal fourth-quarter results, a few days after it said it reached an agreement to acquire Capri (NYSE:CPRI) for $8.5 billion.
Earnings per share (EPS) for the quarter were $0.95, which fell slightly short of the analyst estimate of $0.97. Quarterly revenue amounted to $1.62 billion, slightly below the consensus estimate of $1.66B.
“We drove revenue gains at constant currency, significant gross margin expansion, and double-digit EPS growth despite a rapidly shifting backdrop,” the company said.
Going forward, the company sees FY EPS in the range of $4.10 to $4.15, which is above the consensus of $3.90.
The company expects full-year revenue to be between $6.7B and $6.9B, better than the expected $6.7B.
Tapestry also said it raised its dividend by 17%.
CFRA analysts downgraded the stock to Hold from Buy yesterday and cut the price target by $11 to $40 per share.
"We lower our opinion due to the recent news of the Capri, Inc. acquisition... Although we believe the deal will be fruitful over a 3- to 5-year time frame, we don't expect shares to see significant upside over the next 12 months as the company deals with elevated debt."