Tapestry (TPR:NYS) Fundamental Valuation Report

Fundamental Valuation Report


Consumer Cyclical:Luxury Goods

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$41.70 (USD) 24/10/2018

Weighted Valuation
$57.47 (USD)

Overall Rating
Undervalued by 37.8%

Valuation Models Analyst Consensus: $61.17 (USD)
(in order of importance) Discounted Cash Flow: $57.54 (USD)
Adjusted Book Value: $46.27 (USD)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Undervalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (TPR:NYS USD)

Price 41.70
Range 41.65 – 43.43
52 week 39.90 – 54.64
Open 42.71
Vol / Avg. 4.39M/3.18M
Mkt cap 12.08B
P/E 30.22
Div/yield 1.35/0.03
EPS 1.38
Shares 289.63M
Beta 0.43

Company Description

Tapestry is a designer and retailer of handbags, apparel, footwear, and accessories. Approximately 57% of sales came from North American Coach retail and wholesale distribution in fiscal 2018. Coach also sells its products through international-owned retail, foreign department stores, and international wholesale-serviced specialty shops. Acquisitions include strong brands like Stuart Weitzman (6% of revenue in fiscal 2018) and Kate Spade (22% of revenue in fiscal 2018).

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for TPR:NYS

Using a discounted cash flow model we generated an intrinsic value of $57.54 (USD) for TPR:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

TPR:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $57.54 1% 5% 1% 5%
WACC (or Ke) 6.53 $72.74 $47.39
Terminal Growth Rate 1.50 $48.36 $71.27
Tax Rate 0.33 $62.23 $52.85
Cash Flow 1,650,999,000 $53.96 $61.11
Capital Expenditures -273,157,400 $56.96 $58.12
Long Term Debt 591,400,000 $57.64 $57.43

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $61.39 (USD) for TPR:NYS. We also generated a valuation of $68.95 (USD) using other metrics and comparables.
The comparable companies were and Tiffany (TIF:NYS).

Company TPR:NYS End Date Value
Earnings/Share $1.38 (USD)
Book Value/Share $11.20 (USD)
Sales/Share $20.37 (USD)
Cash Flow/Share $3.45 (USD)
EBITDA/Share $3.23 (USD)
Price Based on Comps Adjustment Factor (%)
$49.30 (USD) -30.3
$57.86 (USD) -7.6
$74.17 (USD) 75.2
$69.91 (USD) -31.9
$47.60 (USD) -10.2
TPR:NYS Ratios Used Average Values TIF:NYS
36.43 PE Ratio 35.73 35.73
4.49 PB Ratio 5.16 5.16
2.47 PS Ratio 3.64 3.64
14.56 PCF Ratio 21.85 21.85
16.01 EV to EBITDA 14.75 14.75


Using a multiples approach we generated a valuation of  $42.45 (USD) for TPR:NYS

Company TPR:NYS End Date Value
Earnings/Share $1.38 (USD)
Book Value/Share $11.20 (USD)
Sales/Share $20.37 (USD)
Cash Flow/Share $3.45 (USD)
EBITDA/Share $3.23 (USD)
Price Based on Comps Adjustment Factor
$32.37 (USD) 0
$45.80 (USD) 0
$49.46 (USD) 0
$47.69 (USD) 0
$36.94 (USD) 0
Ratios Ratio Average
PE Ratio 23.46
PB Ratio 4.09
PS Ratio 2.43
PCF Ratio 13.81
EV to EBITDA 11.45

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  TPR:NYS for the last 10 years was  4.11

We ran the Adjusted Book Value for  TPR:NYS and generated a book value of  $11.27 (USD)
By multiplying these we get an adjusted valuation of  $46.27 (USD)

Analyst Data

In the Stockcalc database there are 6 analysts that provide a valuation for TPR:NYS. The 6 analysts have a concensus valuation for TPR:NYS for 2019 of $61.17 (USD).

TPR:NYS Tapestry

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
9 2 0 4.6364 Buy 2018-10-23

Current Price: 41.7 USD

Analyst Consensus
USD Millions 2019 2020 2021
Mean EPS 2.79 3.09 3.52
# EPS Analysts 7 7 2
Mean Revenue 6,066.10 6,319.90 6,714.40
# Revenue Analysts 5 5 2
Mean Target Price 61.17
Mean Cash Flow 4.00 4.32 4.79
Mean EBITDA 1,364.50 1,474.50 1,626.60
Mean Net Income 809.70 895.80 993.30
Mean Debt Outstanding -132.40 -288.20 -365.00
Mean Tax Rate 21.50 21.50
Mean Growth Rate 5.83
Mean Capital Expenditure 323.30 334.70 332.40

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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