VF Corporation (NYSE:VFC), a notable player in the apparel industry, has reached a 52-week high, with its stock price climbing to $24.95. The company's impressive 54-year streak of consecutive dividend payments underscores its long-term stability, though InvestingPro analysis indicates the stock is currently trading in overbought territory. This milestone reflects a significant recovery and investor confidence, with the stock delivering remarkable returns of over 53% in both six-month and one-year periods. The surge to this new 52-week peak signals a robust turnaround for VFC, which has been navigating through the dynamic retail landscape. While analysts anticipate sales decline this year, they project a return to profitability. For deeper insights into VFC's valuation and growth prospects, InvestingPro subscribers can access comprehensive analysis and 12 additional ProTips in their detailed research report.
In other recent news, VF Corp has seen several significant developments. Guggenheim maintained its Buy rating on VF Corp shares and increased the price target to $27, citing expected top-line improvement, better operating margins, and ongoing balance sheet deleveraging. Additionally, TD (TSX:TD) Cowen raised VF Corp's price target to $24, acknowledging the company's successful debt reduction and comprehensive transformation strategy.
On the earnings front, VF Corp reported a year-over-year revenue decline of 6% for Q2 of fiscal year 2025, marking an improvement from the 10% decline in Q1. The company's gross margin increased to 52.2%, and operating income stood at $315 million. The diluted earnings per share were $0.60, slightly down from the previous fiscal year.
The company also outlined medium-term financial goals, including an adjusted operating margin of at least 10%, an adjusted gross margin of at least 55%, and an adjusted SG&A as a percentage of revenue of 45% or lower. This is part of VF Corp's strategic plan to enhance profitability and shareholder value.
In a strategic move, VF Corp divested Supreme, generating net proceeds of about $1.5 billion and repaid $1 billion of term loans. The corporation also achieved $65 million in cost savings in Q2, totaling $300 million for the fiscal year. For the upcoming quarters, VF Corp projects Q3 revenue between $2.7 billion and $2.75 billion, with a decline of 1% to 3% year-over-year. These recent developments demonstrate VF Corp's ongoing efforts to strengthen its financial health and prepare for future growth.
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