Kontoor Brands (KTB)
NYSE:KTB
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Kontoor Brands
(NYSE:KTB)
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Rating:65Neutral
Price Target:
$70.00
▼(-9.43% Downside)
Action:Downgraded
Date:05/22/26
KTB scores as moderately attractive: solid profitability and cash generation, supportive valuation (low P/E and a ~3.2% yield), and a generally positive guided outlook are balanced against meaningful leverage and recent top-line volatility. Technicals are the biggest near-term drag, with the stock trading below key moving averages and negative momentum indicators.
Positive Factors
Strong cash generation
Kontoor’s free cash flow closely tracks reported earnings, indicating strong cash conversion. Durable FCF supports sustained deleveraging, dividends and buybacks while funding investments in DTC and product, providing resilience through apparel cyclical demand swings.
Negative Factors
Elevated leverage
Kontoor’s historically elevated leverage limits strategic flexibility and increases downside sensitivity to demand shocks. Sustained high debt amplifies risk from margin compression or revenue weakness and forces prioritization of debt paydown over growth investments until leverage normalizes.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Kontoor’s free cash flow closely tracks reported earnings, indicating strong cash conversion. Durable FCF supports sustained deleveraging, dividends and buybacks while funding investments in DTC and product, providing resilience through apparel cyclical demand swings.
Read all positive factors
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 (KTB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.04B
Dividend Yield3.36%
Average Volume (3M)763.58K
Price to Earnings (P/E)14.7
Beta (1Y)1.23
Revenue Growth20.78%
EPS Growth20.89%
CountryUS
Employees13,200
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Manufacturers
Share Statistics
EPS (TTM)4.99
Shares Outstanding55,272,358
10 Day Avg. Volume793,695
30 Day Avg. Volume763,578
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 Cap1.31
Enterprise Value/Revenue1.68
Enterprise Value/Gross Profit3.52
Enterprise Value/Ebitda11.50
Forecast
1Y Price Target
$97.00Price Target Upside25.50% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)5.35
Revenue Forecast (FY)$2.81B
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 Earnings Call Summary
Earnings Call Date:Mar 03, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 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
52
Neutral
Cash Flow
68
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.14B | 3.15B | 2.61B | 2.61B | 2.63B | 2.48B |
| Gross Profit | 1.50B | 1.47B | 1.16B | 1.09B | 1.13B | 1.11B |
| EBITDA | 460.63M | 493.80M | 384.88M | 350.35M | 391.18M | 320.10M |
| Net Income | 277.01M | 227.45M | 245.80M | 230.99M | 245.49M | 195.42M |
Balance Sheet | ||||||
| Total Assets | 2.65B | 2.58B | 1.65B | 1.65B | 1.58B | 1.53B |
| Cash, Cash Equivalents and Short-Term Investments | 56.41M | 108.44M | 334.07M | 215.05M | 59.18M | 185.32M |
| Total Debt | 1.28B | 1.29B | 791.16M | 841.68M | 851.30M | 848.75M |
| Total Liabilities | 2.03B | 2.02B | 1.25B | 1.27B | 1.33B | 1.38B |
| Stockholders Equity | 618.87M | 564.87M | 400.06M | 371.91M | 250.76M | 148.14M |
Cash Flow | ||||||
| Free Cash Flow | 400.17M | 566.72M | 346.11M | 319.17M | 55.19M | 246.99M |
| Operating Cash Flow | 424.44M | 587.77M | 368.23M | 356.55M | 83.58M | 283.86M |
| Investing Cash Flow | -890.10M | -898.76M | -22.26M | -39.14M | -30.12M | -39.37M |
| Financing Cash Flow | 215.18M | 246.80M | -240.35M | -155.70M | -170.91M | -304.07M |
Kontoor Brands Technical Analysis
Positive
77.29
Price Trends
70.67
Positive
67.61
Positive
70.91
Positive
Market Momentum
-0.16
Negative
57.75
Neutral
91.46
Negative
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 77.29 is above the 20-day moving average (MA) of 69.55, above the 50-day MA of 70.67, and above the 200-day MA of 70.91, indicating a bullish trend. The MACD of -0.16 indicates Negative momentum. The RSI at 57.75 is Neutral, neither overbought nor oversold. The STOCH value of 91.46 is Negative, 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 |
|---|---|---|---|---|---|---|---|
73 Outperform | $22.40B | 24.03 | 34.77% | 0.93% | 14.63% | 29.96% | |
70 Outperform | $3.40B | 21.07 | 10.26% | 2.18% | 0.54% | -19.72% | |
65 Neutral | $4.04B | 14.70 | 50.10% | 3.36% | 20.78% | 20.89% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
52 Neutral | $6.82B | 27.53 | 15.92% | 1.95% | -0.72% | ― |
* Consumer Cyclical Sector Average
KTB
Kontoor Brands
73.75
6.45
9.59%
COLM
Columbia Sportswear
67.79
4.67
7.39%
RL
Ralph Lauren
370.77
96.25
35.06%
VFC
VF
17.93
5.37
42.79%
Kontoor Brands Corporate Events
Business Operations and StrategyStock BuybackM&A Transactions
Kontoor Brands Sells Lee Business to Authentic Brands
Positive
May 21, 2026
On May 21, 2026, Kontoor Brands announced a definitive agreement to sell its Lee business to Authentic Brands Group in a transaction valued at up to $1 billion, including an initial $750 million consideration and a potential $250 million earnout t...
Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresM&A Transactions
Kontoor Brands boosts outlook amid Lee divestiture plans
Positive
May 7, 2026
Kontoor Brands reported stronger first-quarter 2026 results on May 7, 2026, with revenue from continuing operations rising 45% to $613 million, supported by 4% growth at Wrangler and solid contributions from Helly Hansen. The company raised its fu...
DividendsRegulatory Filings and ComplianceShareholder Meetings
Kontoor Brands Declares Quarterly Dividend After Governance Changes
Positive
Apr 24, 2026
On April 23, 2026, Kontoor Brands’ board approved amendments to its bylaws, effective immediately after the 2026 annual shareholder meeting, tightening rules around shareholder proposals and director nominations while clarifying procedures f...
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.