Kontoor Brands Inc (KTB)
NYSE:KTB
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Kontoor Brands
(NYSE:KTB)
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Rating:71Outperform
Price Target:
$77.00
▲(5.31% Upside)
Action:UpgradedDate:03/05/26
Overall score reflects strong momentum and a favorable earnings outlook (growth, margin expansion, cost-savings execution), supported by reasonable valuation and dividend yield. The main offset is balance-sheet risk from elevated leverage, alongside meaningful tariff and Lee-brand headwinds highlighted in the latest call.
Positive Factors
Strong cash generation
Consistent high operating and free cash flow (~$456M) provides durable internal funding for debt paydowns, share repurchases, dividends, and strategic investment. Reliable cash conversion supports deleveraging and margin reinvestment even if revenue growth moderates, enhancing financial flexibility.
Negative Factors
Elevated leverage
High leverage amplifies financial risk and reduces strategic flexibility. Interest and principal obligations constrain capital allocation, increase vulnerability to demand or cost shocks, and make achieving management’s <1.5x target critical for restoring balance-sheet resilience over the next 12–18 months.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistent high operating and free cash flow (~$456M) provides durable internal funding for debt paydowns, share repurchases, dividends, and strategic investment. Reliable cash conversion supports deleveraging and margin reinvestment even if revenue growth moderates, enhancing financial flexibility.
Read all positive factors
Kontoor Brands (KTB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.97B
Dividend Yield3.36%
Average Volume (3M)896.95K
Price to Earnings (P/E)15.0
Beta (1Y)1.19
Revenue Growth9.90%
EPS Growth-12.67%
CountryUS
Employees13,200
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Manufacturers
Share Statistics
EPS (TTM)1.73
Shares Outstanding55,254,143
10 Day Avg. Volume548,031
30 Day Avg. Volume896,948
Financial Highlights & Ratios
PEG Ratio-2.07
Price to Book (P/B)6.04
Price to Sales (P/S)1.08
P/FCF Ratio6.02
Enterprise Value/Market Cap1.32
Enterprise Value/Revenue1.67
Enterprise Value/Gross Profit3.57
Enterprise Value/Ebitda12.19
Forecast
1Y Price Target
$96.13Price Target Upside31.47% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)5.96
Revenue Forecast (FY)$3.44B
Kontoor Brands Business Overview & Revenue Model
Company Description
Kontoor Brands, Inc., a lifestyle apparel company, designs, manufactures, procures, markets, and distributes denim, apparel, and accessories under the Wrangler, Lee, and Rock & Republic brands in the United States and internationally. It operates ...
How the Company Makes Money
Kontoor Brands makes money primarily by selling branded apparel—especially denim products—under the Wrangler and Lee brands through a mix of wholesale and direct-to-consumer (DTC) channels.
Key revenue streams include:
1) Wholesale sales: Kontoor...
Kontoor Brands Key Performance Indicators (KPIs)
Any
Revenue by Segment
Shows how sales are split across Kontoor’s brands and product lines (for example Wrangler, Lee, and workwear versus casual apparel), revealing which segments are fueling growth or lagging. Helps investors judge whether the company’s momentum is broad-based or concentrated in a single brand, and whether product mix changes could affect future performance.
Shows how sales are split across Kontoor’s brands and product lines (for example Wrangler, Lee, and workwear versus casual apparel), revealing which segments are fueling growth or lagging. Helps investors judge whether the company’s momentum is broad-based or concentrated in a single brand, and whether product mix changes could affect future performance.
Data provided by:
The Fly
The FlyKontoor Brands Earnings Call Summary
Earnings Call Date:Mar 03, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call conveyed strong, broadly positive momentum driven by record 2025 results, successful Helly Hansen acquisition and integration, meaningful cost savings from Project Genius, Wrangler growth, and constructive 2026 guidance for revenue, margins, and EPS. Material near-term headwinds remain—primarily tariff-related costs (> $100 million impact), Lee brand transition and international wholesale softness, and leverage that is still above management target. Management emphasized confidence in mitigating tariffs over 12–18 months, continued deleveraging, and targeted investments to sustain growth, leading to a favorable outlook overall.Positive Updates
Record Financial Performance in 2025
Company reported record revenue, earnings, and cash flow for 2025: full-year revenue increased 18%, adjusted operating earnings increased by more than 20%, adjusted EPS for the quarter was $1.73 (up 25% year-over-year), and cash from operations exceeded $450 million for the year.
Negative Updates
Lee Brand Underperformance and Transition
Lee experienced softness: global revenue decreased 6% (quarter/full-year context), Lee International revenue declined 15%, and management expects first-half 2026 revenue to decline low-single-digits with an inflection to growth not expected until the second half of 2026 due to distribution and mid-tier channel challenges.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Financial Performance in 2025
Company reported record revenue, earnings, and cash flow for 2025: full-year revenue increased 18%, adjusted operating earnings increased by more than 20%, adjusted EPS for the quarter was $1.73 (up 25% year-over-year), and cash from operations exceeded $450 million for the year.
Read all positive updates
Company Guidance
The company guided full‑year revenue of $3.40–$3.45 billion (≈9% growth), adjusted gross margin of 47.2%–47.4% (up 60–80 bps; H1 47.1%–47.3%), adjusted SG&A up ≈12%, adjusted EPS $6.40–$6.50 (+15–16%; H1 $2.25–$2.30), an effective tax rate of ≈20% (H1 ≈23%), and cash from operations of ≈$425 million; it plans $225 million of voluntary term‑loan payments in 2026 (bringing acquisition‑related repayments to $475M, ~70% of acquisition debt), targets net leverage <1.5x in 2026 (pro‑forma 2.0x today; net debt $1.0B; $108M cash; $500M revolver undrawn), repurchased $25M of stock in Q4 with $190M remaining authorization, and will pay a $0.53/share quarterly dividend. Key program and portfolio metrics embedded in the outlook include Project Genius savings of >$50M in 2025 and approaching $100M in 2026, Helly Hansen pro‑forma revenue >$700M in 2025 (full‑year up ~7%) with mid‑ to high‑single‑digit growth expected in 2026 and China JV revenue ≈$100M in 2025 (+95%, >50% growth expected in 2026), inventory of $567M at Q4 end (down $198M sequentially), and tariff assumptions (15% reciprocal rate effective 2/24/26 on receipts; at least 20% on inventory owned as of end‑2025) that imply a >$100M gross tariff headwind in 2026 (160–180 bps pressure to gross margin net of mitigations) while Project Genius plus channel/product mix and Helly contributions are expected to drive significant margin expansion.Kontoor Brands Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
46
Neutral
Cash Flow
68
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.15B | 2.61B | 2.61B | 2.63B | 2.48B |
| Gross Profit | 1.47B | 1.16B | 1.09B | 1.13B | 1.11B |
| EBITDA | 493.80M | 384.88M | 350.35M | 391.18M | 320.10M |
| Net Income | 227.45M | 245.80M | 230.99M | 245.49M | 195.42M |
Balance Sheet | |||||
| Total Assets | 2.58B | 1.65B | 1.65B | 1.58B | 1.53B |
| Cash, Cash Equivalents and Short-Term Investments | 108.44M | 334.07M | 215.05M | 59.18M | 185.32M |
| Total Debt | 1.29B | 791.16M | 841.68M | 851.30M | 848.75M |
| Total Liabilities | 2.02B | 1.25B | 1.27B | 1.33B | 1.38B |
| Stockholders Equity | 564.87M | 400.06M | 371.91M | 250.76M | 148.14M |
Cash Flow | |||||
| Free Cash Flow | 566.72M | 346.11M | 319.17M | 55.19M | 246.99M |
| Operating Cash Flow | 587.77M | 368.23M | 356.55M | 83.58M | 283.86M |
| Investing Cash Flow | -898.76M | -22.26M | -39.14M | -30.12M | -39.37M |
| Financing Cash Flow | 246.80M | -240.35M | -155.70M | -170.91M | -304.07M |
Kontoor Brands Technical Analysis
Positive
73.12
Price Trends
68.31
Positive
66.43
Positive
69.60
Positive
Market Momentum
1.02
Negative
58.42
Neutral
72.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KTB, the sentiment is Positive. The current price of 73.12 is above the 20-day moving average (MA) of 69.47, above the 50-day MA of 68.31, and above the 200-day MA of 69.60, indicating a bullish trend. The MACD of 1.02 indicates Negative momentum. The RSI at 58.42 is Neutral, neither overbought nor oversold. The STOCH value of 72.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KTB.
Kontoor Brands Risk Analysis
Kontoor Brands disclosed 41 risk factors in its most recent earnings report. Kontoor Brands reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Kontoor Brands Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $3.97B | 15.01 | 45.05% | 3.36% | 9.90% | -12.67% | |
69 Neutral | $23.00B | 15.13 | 34.74% | 0.93% | 12.32% | 29.40% | |
63 Neutral | $3.00B | 17.00 | 10.53% | 2.18% | 2.76% | -7.83% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $7.13B | 6.01 | 14.79% | 1.95% | -3.12% | ― |
* Consumer Cyclical Sector Average
KTB
Kontoor Brands
73.12
18.65
34.25%
COLM
Columbia Sportswear
57.26
-8.86
-13.40%
RL
Ralph Lauren
376.98
177.56
89.04%
VFC
VF
18.44
7.43
67.44%
Kontoor Brands Corporate Events
Business Operations and StrategyDividends
Kontoor Brands Declares Quarterly Dividend, Continues Investor Returns
Positive
Feb 13, 2026
On February 12, 2026, Kontoor Brands’ board approved an Executive Severance Plan that provides tiered severance benefits, including base salary continuation, subsidized COBRA coverage and a pro rated annual bonus, to eligible executives who ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.