Strong Upward Pre-Market Activity For Coach (COH)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Coach ( COH) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Coach as such a stock due to the following factors:

  • COH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $155.0 million.
  • COH traded 69,175 shares today in the pre-market hours as of 7:32 AM.
  • COH is up 7.3% today from Friday's close.

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More details on COH:

Coach, Inc. designs and markets bags, accessories, business cases, footwear, wearables, jewelry, sunwear, travel bags, watches, and fragrances for women and men in the United States and internationally. The stock currently has a dividend yield of 3.9%. COH has a PE ratio of 10.5. Currently there are 6 analysts that rate Coach a buy, 3 analysts rate it a sell, and 14 rate it a hold.

The average volume for Coach has been 6.5 million shares per day over the past 30 days. Coach has a market cap of $9.5 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 1.24 and a short float of 9.6% with 7.19 days to cover. Shares are down 40% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Coach as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • COH's debt-to-equity ratio is very low at 0.09 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.23, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for COACH INC is currently very high, coming in at 75.16%. Regardless of COH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, COH's net profit margin of 17.34% compares favorably to the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Textiles, Apparel & Luxury Goods industry. The net income has decreased by 20.2% when compared to the same quarter one year ago, dropping from $238.93 million to $190.74 million.
  • Net operating cash flow has decreased to $104.87 million or 49.91% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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