Hot Move to Watch: V.F. Corporation (NYSE: VFC)

On 05 Nov 2019, V.F. Corporation (NYSE: VFC) changed 1.65% to recent value of $86.2. The stock transacted 2968027 shares during most recent day however it has an average volume of 1812.2K shares. It spotted trading -8.18% off 52-week high price. On the other end, the stock has been noted 36.33% away from the low price over the last 52-weeks.

VF Corporation (VFC) recently stated financial results for its second quarter ended September 28, 2019. All per share amounts are presented on a diluted basis. This release refers to “stated” and “constant dollar” amounts, terms that are described under the heading “Constant Currency – Not Including the Impact of Foreign Currency.” Unless otherwise noted, “stated” and “constant dollar” amounts are the same. This release also refers to “continuing” and “discontinued” operations amounts, which are concepts described under the heading “Discontinued Operations – Kontoor Brands Business.” Unless otherwise noted, results presented are based on continuing operations. This release also refers to “adjusted” amounts, a term that is described under the heading “Adjusted Amounts – Not Including Icebreaker®, Altra® and Jeans Spin-Off Transaction and Deal Related Expenses, Costs Related to Office Relocations and Specified Planned Business Decisions, and the Impact of Swiss Tax Legislation.” Unless otherwise noted, “stated” and “adjusted” amounts are the same.

Second Quarter Fiscal 2020 Income Statement Review

  • Revenue increased 5 percent (up 7 percent in constant dollars) to $3.4B. Not Including the impact of acquisitions and divestitures and on an adjusted basis, revenue increased 6 percent (up 8 percent in constant dollars), driven by VF’s two largest brands, and our international and direct-to-consumer platforms.
  • Gross margin-increased 90 basis points to 52.9 percent, primarily driven by favorable mix shift toward higher margin businesses and timing of net foreign currency transaction gains. On an adjusted basis, gross margin increased 90 basis points to 53.1 percent.
  • Operating income-on a stated basis was $579M. On an adjusted basis, operating income increased 7 percent (up 10 percent in constant dollars) to $606M. Operating margin on a stated basis increased 20 basis points to 17.1 percent. Adjusted operating margin increased 40 basis points to 17.9 percent.
  • Earnings per share was $1.61 on a stated basis. On an adjusted basis, earnings per share increased 6 percent (up 8 percent in constant dollars) to $1.26.

Balance Sheet Highlights

Inventories were up 10 percent contrast with the same period last year. During the quarter, VF also returned about $171M of cash to shareholders through dividends. The company did not repurchase any shares during the second quarter and has $3.8B remaining under its current share repurchase authorization.

Adjusted Full Year Fiscal 2020 Outlook

VF’s outlook for full year fiscal 2020 is on an adjusted continuing operations basis unless otherwise noted, and has been updated to include the following:

  • Revenue is still predictable to approximate $11.8B, reflecting a raise of about 6 percent (8 percent on a constant dollar basis not including the impact of acquisitions and divestitures). By section, revenue for Outdoor-is still predictable to increase about 5 percent (6 percent to 7 percent on a constant dollar basis, not including the impact of acquisitions). This compares to the previous expectation of a raise in revenue of about 5 percent (6 percent on a constant dollar basis, not including the impact of acquisitions). Revenue for Active is now predictable to increase about 8 percent to 9 percent (11 percent to 12 percent on a constant dollar basis, not including the impact of divestitures). This compares to the previous expectation of a raise in revenue of about 7 percent to 8 percent (10 percent to 11 percent on a constant dollar basis, not including the impact of divestitures). Revenue for Work is now predictable to increase about 2 percent to 3 percent (4 percent to 5 percent on a constant dollar basis, not including the impact of divestitures). This compares to the previous expectation of a raise in revenue of about 3 percent to 5 percent (4 percent to 6 percent on a constant dollar basis, not including the impact of divestitures).
  • International revenue is now predictable to increase about 4 percent to 5 percent, or about 8 percent to 9 percent on a constant dollar basis, not including the impact of acquisitions and divestitures. This compares to the previous expectation of a raise in revenue of about 4 percent to 6 percent (7 percent to 9 percent on a constant dollar basis, not including the impact of acquisitions and divestitures).
  • Direct-to-consumer-revenue is now predictable to increase about 11 percent to 12 percent (12 percent to 13 percent on a constant dollar basis), including about 25 percent growth in digital. This compares to the previous expectation of a raise in revenue of about 10 percent to 12 percent (11 percent to 13 percent on a constant dollar basis).
  • Adjusted gross margin is still predictable to be 54.1 percent, which represents an estimated increase of 80 basis points.
  • Adjusted operating margin is still predictable to be 13.8 percent, which represents an estimated increase of about 90 basis points.
  • Adjusted earnings per share is still predictable to be in the range of $3.32 to $3.37, reflecting growth of about 16 percent to 18 percent (19 percent to 21 percent on a constant dollar basis, not including acquisitions and divestitures).
  • Adjusted cash flow from operations is still predictable to be at least $1.3B.
  • Other full year assumptions include an effective tax rate of about 15 percent to 15.5 percent and capital expenditures of about $400M.

VFC has a gross margin of 52.70% and an operating margin of 11.50% while its profit margin remained 10.10% for the last 12 months. Its earnings per share (EPS) expected to touch remained 407.20% for this year while earning per share for the next 5-years is expected to reach at 5.20%.  The company has 397.75M of outstanding shares and 397.21M shares were floated in the market. According to the most recent quarter its current ratio was 2 that represents company’s ability to meet its current financial obligations. The price moved ahead of -2.20% from the mean of 20 days, -1.15% from mean of 50 days SMA and performed 1.66% from mean of 200 days price. Company’s performance for the week was 6.18%, -2.38% for month and YTD performance remained 28.37%.

 

Ronald Hemphill

Ronald Hemphill– Business Stories My Name is Ronald Hemphill and I am also the main source from the ‘Journalnewsbulletin.com’ of all the exclusive and most delicate visualization of the activities in the business sector. My first step towards this journey was taken in the very early years of my life. I started with an independent financial consultant. However, I only had almost 4 years of skills and experience in this market. I have always been a free personality and like to fly one place to another, to explore more and more. Moreover, this passion and craze of traveling gave me a chance to report a section for best news associations. Last but not least, I am presently working full-time as an editor.

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