CPRI Stock Forecast & Price Target

Capri Holdings is a leading global fashion luxury group, with strong brands in the upscale accessories and apparel market. Despite a decline in sales for 2Q27, we expect further operating leverage in FY28 as the company continues to grow its Michael Kors brand and benefits from expense savings. With the stock currently trading at a discount to its historical average P/E ratio and showing signs of a recovery in the Michael Kors brand, we believe there is potential for upside in the shares.

Capri Holdings is facing a challenging period with negative y/y revenue growth and declining sales at key regions like Americas and EMEA. However, management's turnaround strategy for Michael Kors is showing signs of success with higher full-price sell-throughs and lower tariff rates. The company also has potential for shareholder value creation through initiatives such as a potential share repurchase and focus on improving financial strength and FCF generation. While there is uncertainty in the retail industry, Capri Holdings has potential for value creation and a current valuation of 12.8x our FY28 EPS estimate suggests a potential for a premium multiple compared to its historical average forward P/E multiple of 9.9x.