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    MARKET EDGES

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With the ICR conference this week, it’s important to look at the ‘serial preannouncers’ of years past. Many have already fallen. GES, WRC and VFC have yet to comment. My bet is on VFC.

Warnaco’s expectations look fair to me. Ditto for Guess!. But VF Corp is a different story. We need to assume that VFC’s 4Q business meaningfully outperformed in order to a) hit the quarter and b) mitigate the chance of a tepid outlook. That’s tough to assume. The North Face is weakening on the margin, the denim business is feeling price pressure from Levis in Wal*Mart, FX is not helping anymore, and the department store business – including contemporary brands – are not where they need to be.

In the meantime, VFC is trading at 6.5x EBITDA (30% premium to the group), 80% of sell-side ratings are ‘Buy’ (with no Sells), short interest remains low at 3.5% of the float, and management buying has been nil.

VFC’s communication strategy is quite good, which is why the company so frequently preannounces before a public appearance. Such announcements are usually positive for VFC. The math is tough for me to get all bulled-up this time. In fact, I’d argue that even a lack of an announcement is a negative.