The high-end fashion company Tapestry (NYSE:TPR) has gained significant momentum this year. Its shares have surged more than 8% in price on the company’s most recent reported results, which outpaced Wall Street’s expectations. Furthermore, the company has raised its fiscal 2022 sales outlook. However, given that supply chain issues and operational challenges persist, can the stock keep rallying? Read on.New York City-based fashion retailer Tapestry, Inc. (TPR) provides luxury accessories and branded lifestyle products and operates through three segments: Coach ; Kate Spade; and Stuart Weitzman. TPR shares have gained 58.8% in price over the past year and 45.4% year-to-date to close yesterday’s trading session at $45.84.
Despite supply chain challenges and other constraints created by the COVID-19 pandemic, the company reported robust customer engagement and brand demand. TRP also reported accelerated revenue trends compared to pre-pandemic levels, driven mainly by North America, China, and its digital platform. “We’re taking deliberate steps to accelerate inventory growth, and we feel comfortable in our inventory positioning to meet demand,” said TPR’s Chief financial officer Scott Roe.
The high-end retailer’s shares shot up more than 8% on November 11, after the company reported better-than-expected fiscal first-quarter earnings and revenues and raised its fiscal 2022 sales outlook. Its sales for the quarter came in at $1.48 billion, beating analysts’ expectations by 3.1%. Also, TPR reported quarterly earnings of $0.82 per share versus $0.70 per share consensus estimate. The company also hiked its outlook for the fiscal year. TPR now expects EPS in the range of $3.45 - $3.50, while its sales are expected to be $6.6 billion. In addition, TPR approved an incremental $1 billion share repurchase program, doubling the prior $500 million authorization. The decision demonstrates the company’s confidence in the strength of its underlying business and its ability to drive growth.