VF Corp's Q4 Earnings: What China Reopening And Inventory Optimization Mean For The Company

Telsey Advisory analyst Dana Telsey reiterated an Outperform rating on the shares of VF Corp VFC with a price target of $36.
VFC will report fiscal fourth-quarter earnings on Tuesday, May 23, after the market close.
The analyst expects Q4 EPS of $0.15 versus $0.45 last year and the market expectation of $0.14.
On the topline, the analyst forecasts a Q4 total revenue decline of 4.1% YoY to $2.709 billion, slightly below the consensus decline of 3.6% to $2.724 billion.
The analyst said the China reopening should be supportive, as should the sector-wide inventory optimization.
As recently as last quarter, VFC continued to see disruptions from extended lead times and larger upfront product buys, which was amplified by unpredicted demand spikes due to elevated promotional activity across the sector, added the analyst.
However, the analyst noted that the future looks relatively brighter as VFC called out improving lead times, already benefiting spring deliveries on last quarter's call, and ex-factory dates are becoming more reliable.
The analyst is encouraged by management's strategic priorities to address recent weakness and strengthen the overall company in the near term while positioning it for sustainable long-term growth and profitability.
The analyst continues to believe the company's strong brand portfolio with a favorable mix across categories (active, outdoor, work and street) can drive broad-based growth across channels and geographies longer-term.
Price Action: VFC shares are trading lower by 4.20% at $20.76 on the last check Tuesday.

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