Kontoor Brands (KTB) AI Stock Analysis

• Market Cap: $4.40B
• Dividend Yield: 2.62%
• Average Volume (3M): 653.46K
• Price to Earnings (P/E): 17.7
• Beta (1Y): 1.05
• Revenue Growth: 3.47%
• EPS Growth: 5.86%
• Country: US
• Employees: 13,200
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): 1.21
• Shares Outstanding: 55,574,234
• 10 Day Avg. Volume: 783,990
• 30 Day Avg. Volume: 653,460
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.16
• Enterprise Value/Revenue: 1.93
• Enterprise Value/Gross Profit: 4.23
• Enterprise Value/Ebitda: 12.63
• 1Y Price Target: $89.40
• Price Target Upside: 9.83% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 71 Outperform
• Price Target: $75.00 ▼(-7.86% Downside)

Kontoor Brands demonstrates strong financial performance and positive earnings call highlights, particularly with revenue growth and successful integration efforts. However, high leverage and potential tariff impacts pose risks. The stock's technical indicators suggest bullish momentum, though caution is advised due to overbought signals. Valuation metrics indicate the stock is fairly valued with a good dividend yield.

Positive Factors

Revenue Growth

Kontoor Brands' strong revenue growth, particularly from Wrangler and Helly Hansen, indicates robust market demand and successful brand integration, supporting long-term expansion.

Leadership Changes

Strategic leadership changes aim to enhance global operations and brand management, positioning Kontoor Brands for sustained growth and competitive advantage.

Market Share Gains

Consistent market share gains for Wrangler demonstrate strong brand positioning and consumer loyalty, reinforcing Kontoor Brands' competitive edge in the apparel market.

Negative Factors

High Leverage

Significant leverage poses a risk to financial stability, potentially limiting Kontoor Brands' ability to invest in growth opportunities and manage economic downturns.

Declining Free Cash Flow

Decreasing free cash flow growth may hinder Kontoor Brands' capacity to fund operations and strategic initiatives, impacting long-term financial health.

Tariff Impact

Tariff impacts could pressure margins and profitability, challenging Kontoor Brands' ability to maintain competitive pricing and operational efficiency.

Kontoor Brands Business Overview & Revenue Model

Company Description

Kontoor Brands, Inc. is a global leader in lifestyle apparel, primarily focused on the denim and casual wear sectors. Established as a spin-off from VF Corporation, Kontoor Brands operates through its iconic brands, including Wrangler and Lee, which are known for their quality denim products. The company designs, markets, and sells a wide range of clothing and accessories, catering to diverse consumer segments worldwide.

How the Company Makes Money

Kontoor Brands generates revenue through the direct sale of its apparel products, primarily denim jeans, tops, and outerwear, across multiple distribution channels including wholesale, retail, and e-commerce. The company sells its products to a wide range of retailers, both department stores and specialty shops, and also operates its own branded retail stores and online platforms. Key revenue streams include seasonal collections, collaborations with other brands and designers, and licensing agreements. Kontoor Brands benefits from strategic partnerships with various retailers and online platforms, enhancing its market reach and driving sales. Additionally, the company capitalizes on brand loyalty and a strong heritage in denim to maintain a competitive edge in the apparel market.

Kontoor Brands Financial Statement Overview

Summary

Kontoor Brands shows a strong financial position with robust profitability and effective cash flow management. While the income statement reflects operational efficiency, the balance sheet highlights leverage risks that should be monitored. The cash flow analysis underscores the company's ability to generate cash, though further improvements in cash conversion can enhance overall financial health.

Income Statement

Kontoor Brands shows strong profitability with a consistent gross profit margin around 45% over the years. The net profit margin has been stable, reflecting effective cost management. However, revenue growth has stagnated, with a slight decline in the TTM period compared to previous years, indicating potential market challenges or saturation.

Balance Sheet

The company's debt-to-equity ratio is relatively high, suggesting leverage risk, but there has been improvement in equity levels over recent periods. Return on equity is strong due to solid net income figures, enhancing investor confidence. However, the equity ratio indicates a moderate level of asset financing through equity.

Cash Flow

Kontoor Brands has demonstrated positive free cash flow growth, supporting business operations and potential reinvestment opportunities. The ratio of operating cash flow to net income is favorable, ensuring operational efficiency. However, the free cash flow to net income ratio indicates room for improvement in converting profits into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.65B	2.61B	2.61B	2.63B	2.48B	2.10B
Gross Profit	1.21B	1.16B	1.09B	1.13B	1.11B	863.69M
EBITDA	403.95M	342.29M	350.35M	407.48M	320.57M	183.77M
Net Income	251.28M	245.80M	230.99M	245.49M	195.42M	67.92M
Balance Sheet
Total Assets	2.72B	1.65B	1.65B	1.58B	1.53B	1.55B
Cash, Cash Equivalents and Short-Term Investments	107.48M	334.07M	215.05M	59.18M	185.32M	248.14M
Total Debt	1.53B	791.16M	841.68M	851.30M	848.75M	981.21M
Total Liabilities	2.22B	1.25B	1.27B	1.33B	1.38B	1.46B
Stockholders Equity	498.35M	400.06M	371.91M	250.76M	148.14M	84.64M
Cash Flow
Free Cash Flow	299.28M	346.11M	319.17M	55.19M	246.99M	179.58M
Operating Cash Flow	318.87M	368.23M	356.55M	83.58M	283.86M	241.97M
Investing Cash Flow	-866.25M	-22.26M	-39.14M	-30.12M	-39.37M	-49.07M
Financing Cash Flow	452.98M	-240.35M	-155.70M	-170.91M	-304.07M	-57.69M

Kontoor Brands Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 81.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: 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 81.4 is above the 20-day moving average (MA) of 79.80, above the 50-day MA of 71.36, and above the 200-day MA of 71.42, indicating a neutral trend. The MACD of 2.27 indicates Positive momentum. The RSI at 54.76 is Neutral, neither overbought nor oversold. The STOCH value of 36.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KTB.

Kontoor Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RL	77 Outperform	18.91B	24.91	31.59%	1.15%	9.61%	21.14%
KTB	71 Outperform	$4.40B	17.66	58.07%	2.62%	3.47%	5.86%
COLM	67 Neutral	2.94B	13.68	13.59%	2.36%	0.81%	4.86%
HBI	55 Neutral	2.31B	14.62	53.63%	―	-27.88%	―
VFC	53 Neutral	5.79B	68.23	-3.66%	2.50%	-7.41%	―
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Kontoor Brands Corporate Events

Kontoor Brands Announces Executive Transition Agreement

On July 29, 2025, Kontoor Brands announced that Thomas E. Waldron stepped down from his position as Executive Vice President and Chief Operating Officer. He will remain with the company in a non-executive role until September 30, 2025, to ensure a smooth transition. Under a Separation Agreement signed on August 31, 2025, Waldron will receive $1,350,000 over eighteen months, along with other benefits such as eligibility for performance-based incentives and healthcare coverage under COBRA. The agreement also includes non-compete and non-solicitation clauses.

Kontoor Brands Announces Leadership Changes for Growth

On July 29, 2025, Kontoor Brands announced leadership changes with Joseph A. Alkire and Jennifer H. Broyles taking on expanded roles. Alkire will now oversee global operations as Executive Vice President, Chief Financial Officer, and Head of Global Operations, while Broyles will lead international and commercial operations for Lee and Wrangler as Executive Vice President, Chief Commercial Officer, and Global Head of Brands. These changes are part of Kontoor’s strategic evolution to expand its brand portfolio and accelerate growth, aiming to deliver long-term value for shareholders. Tom Waldron, the outgoing Executive Vice President and Chief Operating Officer, will assist in the transition until September 30, 2025.

Kontoor Brands Declares Quarterly Cash Dividend

On July 25, 2025, Kontoor Brands, Inc. announced that its Board of Directors declared a regular quarterly cash dividend of $0.52 per share of common stock. This dividend is payable on September 19, 2025, to shareholders of record as of September 9, 2025. This decision reflects the company’s ongoing commitment to providing value to its shareholders and may impact its financial positioning and stakeholder relations.