Analyst Note| David Swartz |
Although affected by virus-related store closures in Europe and elsewhere, narrow-moat VF’s (March-ending) fiscal 2021 fourth-quarter sales and constant-currency adjusted earnings of $2.6 billion and $0.27, respectively, were close to our estimates of $2.5 billion and $0.29. Moreover, its outlook for fiscal 2022 adjusted EPS of $3.05 aligns with our current $3.04 estimate. VF’s shares, though, dropped about 7% on the report as investors may have been looking for stronger guidance. Regardless, we believe its major brands have good momentum as activewear and outdoor gear are in high demand. We expect to raise our per share fair value estimate on VF of $58 by a mid-single-digit percentage but view its shares as overpriced.