Recently, I read a blog that wrote the below opinion piece on Coach:
-----------------------------------------
Coach, Inc. (NYSE:COH): Another big-name retailer, this handbag and luxury goods specialist's shares have struggled in 2014. But it still has an economic moat because of its "brand history and the extensive, directly operated, and wholesale distribution network", according to Morningstar. And again, the numbers back it up. Coach's three-year average net profit margins are nearly 20%, for example. It gets some interest from my Buffett-based model, in part because it has averaged a return on equity of more than 38% over the past decade. And it gets strong interest from the Greenblatt-based model, in part because of its stellar 39% return on capital.
-----------------------------------------
So, is Coach a value-stock now a Value-trap?
What is your take?
My gut instinct (without doing a lot of research and background study yet) is that "Coach is a value-trap"!
I have been receiving some emails from Coach marketing their products. I don't buy Coach products, and have never bought anything from Coach before, nor do I intend to any time now or in future. The fact that I am receiving such "spam" emails from Coach does give me an impression that business for Coach must have been really bad now that they need to resort to "spamming" our mailbox!
Having said that, it would only be fair to do a detail research and background study before I put the nail on the coffin for Coach. Ok, let's wait I have the time to do one. I would be more interested to do for some other stocks I am eyeing now..... Will keep you updated soon............
No comments:
Post a Comment