CPRI Stock Forecast & Price Target

Capri Holdings is well-positioned for growth, with the retail channel projected to provide a $900 million incremental revenue opportunity, as sales are expected to rise from 68% in FY24 to 75% over time. The company's focus on licensed products, particularly eyewear and beauty, is anticipated to help drive sales beyond $2 billion, contributing to a strategic shift towards accessories. Additionally, gross margin expansion is expected due to reduced markdowns, a new pricing architecture, and continued growth in the accessories segment, suggesting a solid financial foundation for future profitability and operational leverage.

Capri Holdings faces a negative outlook primarily due to declining sales expectations in key regions, particularly the Americas, which are projected to drop from 68% in FY25 to 60% in the long term, exacerbated by a forecasted need for revenue recovery until FY27. The company’s fundamental struggles are highlighted by the deterioration of the Michael Kors brand, which, despite initiatives to address its underperformance, could pose risks if effective turnaround strategies do not materialize. Additionally, external pressures, including geopolitical tensions and weakened demand for luxury goods, further complicate the financial stability of Capri Holdings, contributing to the divergence between the stock price and intrinsic value of its portfolio.