Market Capitalization Of Michael Kors Plummeted Nearly 25%

Light luxury is bubble? The latest news from New York, Michael Kors, has fallen by nearly 25%.

On Wednesday, New York stock exchange Michael Kors shares plunged 24.2% to close at $45.93 a share.

Within a day, its market value evaporated more than 3 billion dollars.

In 2014, there was a light bubble argument, and founder fashion tycoon Cao Qifeng quit Michael Kors completely.

At present, the market value of Michael Kors has dropped to 9 billion 220 million US dollars from 12 billion 370 million US dollars two years ago.

During the paction, the company's share price reached a minimum of $45.88 per share, a new low of 52 weeks, and nearly 6730 shares in the stock market, with an average paction volume of 2 million 900 thousand shares in March.

The collapse of Michael Kors's share price reflects investors' concerns about the decline in North American store sales in the fourth quarter, and is not optimistic about the comparable turnover of stores in the current fiscal year.

Not only the stock of Michael Kors has been affected.

Coach and Kate Spade of brand handbags are also worried about the decline in share prices.

The US luxury brand Coach is no longer favoured by analysts as a "reduction" rating. According to Freedman's report, the us light luxury brand Coach has been labeled as a "reduction" rating, and its share price fell 5% to 34.61 dollars in early trading in May 27th.

In addition, Freedman is skeptical about Coach's future prospects. He said, "since the senior management has worked out the change plan, nearly a year has passed, but we are worried about the progress of the company so far.

Although we believe it remains to be seen whether Coach can change the brand positioning, our expectations remain low.

Kate Spade shares fell 4.7% to $25.39 a share, but Freedman said it was optimistic about its future trend.

This series of decline shows that investors do not think these lightweight luxury handbags are suitable for elite consumers. Brand price setting is more inclined to mass consumption rather than luxury category.

Of course, not all fashion brands' share prices are affected.

On Wednesday, Tiffany shares rose 11%, although the company reported a 16.5% decline in first quarter profits.

Obviously, compared with light luxury, the market is more interested in pure luxury brands.

Light luxury brands like Coach and Kate Spade will have a difficult time.

The latest quarterly report shows that

In the third quarter, profits fell by 54%, while Kate Spade lost more in the first quarter.

On Wednesday, the Michael Kors report showed a two digit growth in comparable store sales, while the annual turnover was relatively mild.

By the end of March 28th, Michael Kors's net profit in the fourth quarter increased from $161 million last year to $182 million 600 thousand, or 13.4%, and diluted share value rose from 90 cents last year to 78 cents.

Net income rose from $917 million 500 thousand to $1 billion 80 million, or 17.8%.

However, in the quarter, the North American market fell by 6.7% compared to that of the stores, and fell by 5.8% on a constant exchange rate basis.

Earlier, Wall Street analysts estimated that earnings per share would reach 91 cents on the basis of $1 billion 80 million profit, and the current data is slightly below expectations.

The growth rate of corporate profits has been the slowest since the IPO in December 2011.

Although Michael Kors chairman and CEO John Idol told analysts in the conference call, the company is very satisfied with the continuous growth of its entire line of business. The decline in store turnover is mainly due to the decline in the North American market, the depression of the North American watch business, the reduction of the number of tourists and the negative impact of the logistics delay on shoes, women's clothing and small leather products caused by the west coast port problem in the US.

Idol said currency exchange rate will continue to adversely affect this year.

But he told analysts that the company will continue to reduce its watch business, mainly because the company believes that the market's profitability is turning to our jewelry category.

In the past 12 months, Michael Kors has added 121 new stores worldwide, and is expected to continue to open more new stores. If the company is not fully prepared, it will face an overexposure crisis.

Joseph B. Parsons, chief financial officer, told analysts that the company's gross margin fell from 59.9% to 58.4%, mainly due to additional discounts and increased costs.

In addition, because the company has been buying and serving the standard currency in the international business, it will face a paction crisis.

Parsons says a lot of good things.

They will expire at the beginning of the fiscal year, which will solve the problem of high cost of some commodities. "

In sharp contrast, Tiffany, as of April 30th, net profit fell from $125 million 600 thousand last year to $104 million 900 thousand, diluted from 97 cents last year to 81 cents.

Net turnover fell from $1 billion 10 million to $962 million 400 thousand, or 4.9%.

On the basis of a constant exchange rate,

Comparable store sales increased by 1%.

Analysts predict earnings per share will be 70 cents on the basis of a company's revenue of $918 million 700 thousand.

In the New York stock exchange, Tiffany's shares rose to $94.54.

Turnover amounted to over 6 million 700 thousand, compared with 1 million 600 thousand pactions in March.

The company's CEO Fred Cumenal pointed out that the strength of the US dollar and global instability are increasing, and the global economy is declining. At the same time, we commend the company's performance in the first quarter "to a certain extent better than our expectations".

The company said its comparable store sales in Japan fell by 24%, reflecting a surge in consumer spending before the consumption tax increased in April 1, 2014, most of which came from foreign tourists, especially in China.

As the US dollar rises, the company's overseas sales soared, and consumers are more willing to shop in Europe.

This season, the new series of Tiffany T, which is launched this fall, has performed well. The series of flagship gold jewelry design products offset the bad performance of silver ornaments priced below US $500.

At the Wall Street analysts' conference call, the company's chief financial officer, Ralph J. Nicoletti, said the gross margin of the company was 59.2%, 9/10 higher than last year.

The company's forecast for the future is more or less consistent with the fourth quarter results released in March 20th, and pointed out that it will continue to face the macro challenges. Based on our prediction of the trend of exchange rate, we believe that this year should be prudent in maintaining revenue rather than continuing to pursue growth.