Tapestry Earnings: Coach’s Brand Strength Powers Strong Holiday; Shares Overvalued

Tapestry’s (December-ended) fiscal 2025 second-quarter sales and profitability surpassed expectations. The outperformance was attributable solely to Coach (78% of sales), the brand that underlies our narrow moat rating. We expect to lift our fair value estimate of $59 by a mid-single-digit percentage but regard Tapestry’s shares, which have soared since the proposed acquisition of no-moat Capri fell through, as overvalued and would look for a better entry point.