Kontoor Brands beats Q2 revenue estimates, raises FY outlook
Overview
Kontoor Brands Q2 rev rises 8%, beating analysts' expectations, per LSEG data
Adjusted EPS for Q2 beats consensus, rising 23% yr/yr, per LSEG data
Co raises full-year 2025 outlook, despite higher tariffs impact
Outlook
Kontoor Brands expects full-year 2025 revenue of $3.09 to $3.12 bln
Company projects 2025 adjusted EPS to be approximately $5.45
Kontoor Brands anticipates adjusted operating income of $443 mln for 2025
Company forecasts cash flow from operations to exceed $375 mln in 2025
Result Drivers
HELY HANSEN ACQUISITION - Accounted for half of revenue increase in Q2, with $29 mln in June revenue
WRANGLER GROWTH - Wrangler brand global revenue rose 7% with U.S. revenue up 9% driven by an 8% increase in wholesale and a 16% rise in direct-to-consumer sales
GROSS MARGIN EXPANSION - Adjusted gross margin increased 120 basis points to 46.4% due to Project Jeanius, lower product costs, and a favorable product mix
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue | Beat | $658 mln | $634.90 mln (5 Analysts) |
Q2 Adjusted EPS | Beat | $1.21 | $0.83 (5 Analysts) |
Q2 EPS | $1.32 | ||
Q2 Gross Margin | 46.3% | ||
Q2 Operating Income | $79 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 1 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the apparel & accessories peer group is "buy"
Wall Street's median 12-month price target for Kontoor Brands Inc is $85.00, about 33.3% above its August 6 closing price of $56.72
The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 12 three months ago
Press Release: