Tapestry stock price forecast: Jefferies sees a 40% upside

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on Jun 15, 2022
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  • Jefferies upgrades Tapestry Inc to "buy" with a price target of $45 a share.
  • Analyst Ashley Helgans reveals several catalysts for the luxury fashion retailer.
  • Tapestry stock is currently down nearly 20% versus the start of the year 2022.

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Tapestry Inc (NYSE: TPR) is up 5.0% on Wednesday after a Jefferies analyst said the stock was a “major opportunity” for investors interested in playing the retail space.

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Tapestry Inc could be a $45 stock

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Ashley Helgans upgraded TPR to “buy” this morning with a price target of $45 a share that represents a 40% upside from here. Previously, she had a PT of $30 on the stock. The analyst wrote:

We’re shifting to a more constructive view on improved margin and sales growth outlook driven by the foundational changes made to the business over the last few years, namely digital, marketing, and data.

Last month, Tapestry Inc reported its results for the fiscal third quarter that topped Wall Street expectations. Shares of the NYSE-listed retailer, at present, are down nearly 20% versus the start of 2022.  

Tapestry can hold its own in a recession

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The Jefferies analyst also expects the luxury fashion holding company to benefit (both in near and the long term) as China comes out of the lockdown. She’s convinced Tapestry can weather a recession as well.

Past recession performance gives us confidence in company’s ability to manage current choppy macro landscape. Luxury goods tend to hold up better during recession. Upside opportunity is compelling at <8x FY2 P/E, in line with ’08 levels.

The bullish note comes in the face of an unexpected 0.3% decline in retail sales the U.S. Commerce Department reported for May on Wednesday.  

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