Hold Rating for VF Corp Amid Financial Challenges and Brand Weakness

John Kernan, an analyst from TD Cowen, maintained the Hold rating on VF (VFC – Research Report). The associated price target was lowered to $15.00.

John Kernan has given his Hold rating due to a combination of factors impacting VF’s financial outlook. The company is experiencing ongoing challenges with its Vans brand, which continues to face top-line weakness, overshadowing growth in other segments like The North Face and Timberland. Despite a surprise improvement in gross margin during the fourth quarter, the overall financial performance remains under pressure.
Additionally, VF’s cash flow and capital expenditure modeling present complexities, with free cash flow projections for FY25 assuming benefits from net working capital. Higher-than-expected interest expenses and taxes for FY26 have led to a reduction in earnings per share assumptions below consensus through FY27. The company’s efforts to manage tariff impacts and improve cash flow are noted, but the balance sheet and inventory turnover issues remain a concern. These factors collectively contribute to the Hold rating, with a price target adjustment to $15.

Kernan covers the Consumer Cyclical sector, focusing on stocks such as TJX Companies, On Holding AG, and Columbia Sportswear. According to TipRanks, Kernan has an average return of 10.4% and a 56.51% success rate on recommended stocks.

In another report released today, Telsey Advisory also maintained a Hold rating on the stock with a $17.00 price target.