Ike Boruchow, an analyst from Wells Fargo, maintained the Sell rating on VF (VFC – Research Report). The associated price target was lowered to $18.00.
Ike Boruchow has given his Sell rating due to a combination of factors impacting VF’s current and future performance. Despite the company’s ambitious targets for fiscal year 2028, including improved gross margins and operating margins, there are significant concerns about the company’s ability to achieve these goals without substantial revenue growth. The management’s cautious tone regarding the turnaround of the Vans brand and the lack of new financial updates during the recent Analyst Day further contribute to the uncertainty surrounding VF’s growth prospects.
Moreover, the company’s revenue projections for the upcoming fiscal years appear to be declining, with expectations of ending fiscal year 2025 below the fiscal year 2024 revenue levels. This decline poses a challenge to achieving the set margin targets, as growth will be necessary to meet these objectives. Additionally, the need for a strategic repositioning of the Vans brand, coupled with the management’s acknowledgment of the work required, suggests that a quick turnaround is unlikely. These factors, along with the company’s high leverage and a potentially worsening macroeconomic environment, underpin Boruchow’s Sell rating on VF’s stock.
In another report released today, Bank of America Securities also maintained a Sell rating on the stock with a $18.00 price target.