NEW YORK ( TheStreet) -- Coach (COH) , a luxury-goods maker and retailer best known for its handbags, is trying to spark its sales, profit and stock price by expanding more into clothing and aiming for more upscale customers.
Investors may want to consider the shares while they are down.
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The stock has lost 35.7% so far this year through Monday's close, compared with a gain of 11.1% for the Standard & Poor's 500 Index. The shares trade at 14.7 times estimated earnings for Coach's current fiscal year, which ends in June. The S&P 500 trades at 17.3 times estimated earnings and rival Michael Kors (KORS) 19.3 times.
Coach's dividend yield stands at 3.6%, compared with 1.9% for companies in the S&P 500. Kors doesn't pay a dividend.
As it increases its offerings of apparel and shoes, Coach is introducing clothes designed by Stewart Verver, its creative director whom it hired last year. His spring 2015 collection received favorable press from trade publication Fashionista.
Meanwhile, Coach is going upscale, partly by decreasing its discounts. It has reduced flash sales to three per month from three per week. It also plans to close 70 underperforming stores, roll out a new store design concept, devote more resources to its flagship stores and boost its presence in department stores. The company is also opening luxury retail stories in Beverly Hills, Calif.; New York; and Tokyo.