Michael Kors 2016
Uncategorized / April 27, 2017

The stock has fallen more than 50% since the top in 2014 because of the combined effects of several factors:Recessions/weakness in emerging markets such as Russia, Brazil and China. This factor has negatively impacted the company’s results as it has led to an appreciation of the USD against other currencies. Falling income and currency disadvantage have weighed on tourism and tourist spending in the US, leading to a contraction in sales of fashion items. Michael Kors was not immune to the general weakness in the industry.The second factor is the deceleration, peak and consequent downtrend in comps, which has fueled a short case for KORS. Bears believe that Michael Kors’ success is the result of a fad, which has led to a boom and bust in sales. Moreover, bears believe that the heavy discounts in department stores are threatening the brand status and attractiveness. Michael Kors (NYSE:KORS) stock has had a rough stretch recently as it has gone from being looked at as a growth stock to a value stock. This type of change does not signify that Michael Kors was a fad. It just shows that the double digit same store sales growth was unsustainable. The realization caused the…