REVENUE AND GROWTH
According to historical data, Michael Kors had a constant growth in revenue since 2013 at a rate around 30% to 50%. Michael Kors has opened numbers of new stores include traditional stores located in malls and some special store in tax-free area in the airports.
Also, the advertising and promotion help Michael Kors to be more popular among younger generations and white-collar office workers. Without worrying about losing consumers, those loyal customers make it possible for Michael Kors to slightly increase product price every year.
Based on these facts, we assume that MK will still experience a stable increase in sales volume and revenue.
COGS
Based on historical data, Michael Kors’ cost of good sold is typically around …show more content…
Taking an average of those three price, our final target price is $80.
COMPETITORS THREAT
Michael Kors, as a affordable luxury brand, has many competitors in low-end luxury market. You’ll find Kate Spade, Tory Burch, Marc by Marc Jacobs and many other threatening rivals. Some of them like Kate Spade and Coach, Inc. has already went public, while some other of them like Tory Burch has a highly potential of going public soon. MK needs to create continuously innovation and distinct product to attract new customers and build loyalty for old customers.
FAIL IN EXPANSION
As of today, Michael Kors already has over 500 stores locate in 89 countries all over the world. It opened over 150 stores only in last two years. Its quick expansion can be harmful to the company because the lack of adaption of different culture and consumption environment. With the rapid growth of stores, Kors experienced $60 fallen in stock price ending with $37 in December 2015, which is 68% decrease compare to January 2014. Kors may need to be aware of the negative impact of large
According to historical data, Michael Kors had a constant growth in revenue since 2013 at a rate around 30% to 50%. Michael Kors has opened numbers of new stores include traditional stores located in malls and some special store in tax-free area in the airports.
Also, the advertising and promotion help Michael Kors to be more popular among younger generations and white-collar office workers. Without worrying about losing consumers, those loyal customers make it possible for Michael Kors to slightly increase product price every year.
Based on these facts, we assume that MK will still experience a stable increase in sales volume and revenue.
COGS
Based on historical data, Michael Kors’ cost of good sold is typically around …show more content…
Taking an average of those three price, our final target price is $80.
COMPETITORS THREAT
Michael Kors, as a affordable luxury brand, has many competitors in low-end luxury market. You’ll find Kate Spade, Tory Burch, Marc by Marc Jacobs and many other threatening rivals. Some of them like Kate Spade and Coach, Inc. has already went public, while some other of them like Tory Burch has a highly potential of going public soon. MK needs to create continuously innovation and distinct product to attract new customers and build loyalty for old customers.
FAIL IN EXPANSION
As of today, Michael Kors already has over 500 stores locate in 89 countries all over the world. It opened over 150 stores only in last two years. Its quick expansion can be harmful to the company because the lack of adaption of different culture and consumption environment. With the rapid growth of stores, Kors experienced $60 fallen in stock price ending with $37 in December 2015, which is 68% decrease compare to January 2014. Kors may need to be aware of the negative impact of large