CPRI Stock Forecast & Price Target

Capri Holdings reported a strong resurgence in its Asia segment, with a 25.4% year-over-year growth in FQ2, driven by increased wholesale shipments following a previous contraction, indicating a recovery in the consumer market. The company is also seeing improvements in its global consumer engagement, as evidenced by a 9% increase in the global consumer database for both the Michael Kors and Jimmy Choo brands, suggesting effective marketing strategies and broader brand appeal. Furthermore, management anticipates retail trends will improve in the latter half of FY26, with expectations of returning to growth in FY27, supported by strategic actions like the anticipated sale of Versace, which could potentially streamline operations.

Capri Holdings has reported a decline in total revenues of 2.5% year-over-year, totaling $856 million in the second quarter, indicating a weak overall performance despite slightly outperforming market forecasts. The company's flagship brand, Michael Kors, experienced a 1.8% decrease in sales, primarily driven by a significant decline in the Americas, while Jimmy Choo also faced a 6.4% drop in revenue, marking the fourth consecutive quarter of declining sales for both luxury brands. Additionally, adjusted gross margin guidance indicates an expected decline of 200 to 250 basis points, largely due to the increased cost impact of inventory tariffs, further contributing to concerns about the company's financial health.