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Capri outperformed our profitability estimates in fiscal 2022’s (September) second-quarter as strong pricing generated an adjusted gross margin of 67.6%, nearly 4 percentage points above our forecast. We expect to lift our fair value estimate of $51 on its shares by a high-single-digit percentage but view them as overvalued after a low-double-digit jump on the news.
Michael Kors, Versace, and Jimmy Choo are the brands that comprise Capri Holdings. Capri markets, distributes, and retails upscale accessories and apparel. Michael Kors, Capri’s largest and original brand, offers handbags, footwear, and apparel through more than 800 company-owned stores, third-party retailers, and e-commerce. Milan-based Versace (acquired in 2018) is known for its ready-to-wear luxury fashion. Jimmy Choo (acquired in 2017) is best known for women’s luxury footwear. John Idol has served as CEO since he was part of a group that acquired Michael Kors in 2003.
