Michael Kors Holdings Ltd. (NYSE:KORS) was up 0.95% towards the end of the noon hour on August 17. The stock is up 14% in 2018 so far. Clothing retail has struggled since the financial crisis, but luxury brands remain an attractive option. Michael Kors and others that have met with success in recent years have been able to leverage a traditional retail footprint and e-commerce platforms that bolster profitability.
Michael Kors released its fiscal 2019 first-quarter results on August 8. Its brand revenues rose 8% year-over-year with positive comparable store sales in the Americas. The acquisition of Jimmy Choo paid off nicely and powered a strong performance in footwear. Gross profit climbed 30.6% from fiscal 2018 Q1 to $750.8 million and total revenue increased 26.3% to $1.2 billion.
Michael Kors raised its full-year adjusted earnings per share guidance to $4.90 to $5.00. This was inspired by results from the core Michael Kors and Jimmy Choo brands. The company is forecasting $5.125 billion in revenue with between $580 million and $590 million generated from the Jimmy Choo brand.
Luxury brands have benefitted from an improving economy, the rise of consumers in Asia, and more activity among a choosy millennial demographic. Michael Kors is a good bet to post strong earnings especially as we enter the holiday shopping season in the midst of the strongest economic environment seen in the U.S. since before the financial crisis. With a potential slowdown on the horizon the window is still open for investors to take advantage of the success of luxury brand retail.
This article provided by NewsEdge.