Tags: Michael Kors Shares Decline After Sales Growth Misses Estimates

Michael Kors Shares Decline After Sales Growth Misses Estimates

Tuesday, 04 Nov 2014 09:10 AM

Nov. 4 (Bloomberg) -- Michael Kors Holdings Ltd. shares fell as much as 7.7 percent in early trading after same-store sales missed estimates, raising concern that one of fashion’s biggest growth stories is losing momentum.

Comparable-store sales rose 16 percent in the second quarter, the Hong Kong-based company said today in a statement. Analysts had estimated growth of almost 19 percent, according to Consensus Metrix. The North America region grew almost 11 percent, missing a projection of more than 15 percent.

While total revenue and earnings still beat estimates, the results renewed fears that a slowdown is under way. Sportswear Holdings Ltd., Michael Kors’s largest shareholder, announced plans to sell its stake in September, following an almost fourfold gain in the stock since its initial public offering in 2011. The move put investors on edge, sending the stock down 4.5 percent that day.

Shares of the company, which makes designer clothing and handbags, fell as low as $72 in pre-market trading today. The stock had declined 3.9 percent this year through yesterday.

Michael Kors has seen sales surge over the past decade by enticing consumers with affordable luxury: The company’s handbags can cost a few hundred dollars, rather than the $800 to $1,000 or more that Louis Vuitton and Gucci charge. Its namesake designer also gained fame for appearing as a judge on reality show “Project Runway.” The 55-year-old, who left his TV job in 2012, has a net worth of about $1 billion, according to the Bloomberg Billionaires Index.

To contact the reporter on this story: Nick Turner in New York at nturner7@bloomberg.net To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net Bruce Rule

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Michael Kors Holdings Ltd. shares fell as much as 7.7 percent in early trading after same-store sales missed estimates, raising concern that one of fashion's biggest growth stories is losing momentum.Comparable-store sales rose 16 percent in the second...
Michael Kors Shares Decline After Sales Growth Misses Estimates
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2014-10-04
Tuesday, 04 Nov 2014 09:10 AM
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