Michael Kors Is in Season for Investors

2011 IPO star surges after strong earnings report

   

Coming public in mid-December, Michael Kors (NYSE:KORS) was one of the top IPOs of the year, spiking 21% on its first day of trading. KORS is the global luxury brand of its namesake designer, with product lines for apparel, handbags, shoes and watches.

Today, the stock got another boost, up almost 23% at midday to around $41.25 — almost double its $20 IPO price!

This came off Michael Kors’ blowout quarterly report — its first as a publicly traded company. Revenues soared 68% to $376.6 million, which beat the Wall Street consensus of $349 million. Same-store sales climbed 38% in North America and up 34.4% in Europe. And adjusted earnings came to 28 cents per share.

With the U.S. economy — and the stock market — coming back, it looks like the momentum will remain strong. Michael Kors sees current-quarter earnings reaching a range of 10 to 12 cents and revenues reaching $350 million to $355 million. The Street’s estimate is for 11 cents and $347 million.

Besides its own chain of stores, Michael Kors has been effective in getting distribution with top operators like Bergdorf Goodman, Saks Fifth Avenue (NYSE:SKS), Neiman Marcus, Harrods, Nordstrom (NYSE:JWN) and Macy’s (NYSE:M).

But more importantly, Michael Kors has a knack for understanding the fashion needs of the jet-set. And unlike other brands that quickly fizzle out, this company has found ways to grow and evolve since the early 1980s.

Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “The Complete M&A Handbook”“All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/ipo-playbook/michael-kors-is-in-season-for-investors/.

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