CPRI Stock Forecast & Price Target

Capri Holdings is poised for significant growth with projected incremental revenue opportunities of $900 million within the retail channel, alongside anticipated increases in licensed products sales, expected to exceed $2 billion. The company also forecasts expanding gross margins driven by cost reduction initiatives and a shift towards accessories, with the accessory and footwear segments targeted to grow their sales mix significantly. Additionally, both the EMEA and Asia regions are expected to stabilize and return to growth in FY27, contributing an estimated $650 million in incremental revenue over the long term.

The financial analyst highlights several fundamental reasons for a negative outlook on Capri Holdings's stock. Key concerns include a projected decline in the Americas' contribution to brand sales from 68% in FY25 to 60% in the long term, alongside a reduction in expected revenue growth, which is anticipated to face significant challenges from soft demand for luxury goods and international pressures, notably in China. Additionally, ongoing strategic adjustments such as retail store optimization, pricing resets, and foreign exchange headwinds are expected to create near-term difficulties, further distancing the stock's price from its intrinsic value.