Tapestry, Inc. TPR is strengthening its competitive position as robust global momentum behind its Coach brand continues to drive market share gains across key regions. In the fiscal third quarter of 2026, Coach delivered constant-currency revenue growth of 29%, fueled by strong demand across North America, Greater China and Europe. The brand's consistent execution, combined with Tapestry's consumer-led Amplify strategy, enabled the company to outperform the broader luxury market while raising its fiscal 2026 outlook.
Coach's growth is being supported by strong customer acquisition and sustained demand for its core leather goods business. During the quarter, the brand welcomed 2 million new customers, with Gen Z acquisition accelerating meaningfully. Handbag unit volumes increased more than 20%, while average unit retail advanced at a low double-digit rate, reflecting healthy pricing power and solid consumer demand. Signature franchises such as Tabby, Brooklyn, Empire and Chelsea continued to resonate globally, reinforcing Coach's leadership in the accessible luxury market.
The brand's global expansion strategy is translating into meaningful market share gains. Coach recorded constant-currency sales growth of 27% in North America, 58% in Greater China and 27% in Europe, significantly outperforming industry trends. Tapestry's direct-to-consumer model, supported by digital capabilities and data-driven consumer insights, helped deliver approximately 25% digital sales growth and more than 20% growth in brick-and-mortar stores, strengthening customer engagement and profitability across channels.
Marketing investments continue to enhance Coach's global brand appeal. Tapestry increased marketing spending by roughly 50% year over year, focusing on top-of-funnel brand building, Gen Z engagement and localized campaigns. Initiatives such as the "Explore Your Story" campaign, collaborations in China and immersive Coach Play stores further strengthened brand relevance, increased consumer traffic and supported new customer acquisition across key markets.
With less than a 1% share of its global addressable market, management reiterated its confidence that Coach has a significant runway for expansion and remains on track to become a $10 billion brand with best-in-class margins over time.
Management expects Coach revenues to grow more than 20% in fiscal 2026, reflecting continued strength across key markets, product categories and customer segments. It expects revenues of about $7.95 billion, an operating margin of approximately 23% and earnings per share of around $6.95. Supported by ongoing product innovation, expanding digital capabilities, strong Gen Z customer acquisition and disciplined brand investments, Coach remains well-positioned to drive Tapestry's long-term market share gains.
TPR’s Price Performance, Valuation & Estimates
Shares of Tapestry have risen 41.2% over the past year compared with the industry’s 3.5% growth.
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From a valuation standpoint, TPR trades at a forward price-to-earnings ratio of 19.38X, up from the industry’s average of 14.51X. It has a Value Score of A.
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The Zacks Consensus Estimate for Tapestry’s fiscal 2027 earnings implies year-over-year growth of 36.7%, whereas the same for fiscal 2028 indicates an uptick of 10.6%. Earnings estimates for fiscal 2027 and 2028 have been increased by 1 cent and 2 cents, respectively, in the past seven days.
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TPR’s Zacks Rank & Key Picks
Tapestry currently carries a Zacks Rank #3 (Hold).
Genesco Inc. GCO is a Nashville-based specialty retailer and branded company. It sells footwear and accessories through retail stores. The company flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Genesco’s current fiscal-year earnings indicates growth of 55.2% from the year-ago actuals. GCO delivered a trailing four-quarter average earnings surprise of 3.8%.
Canada Goose GOOS is a global outerwear brand. Canada Goose is a designer, manufacturer, distributor and retailer of premium outerwear for men, women and children. The company also holds a Zacks Rank #1 at present.
The Zacks Consensus Estimate for Canada Goose’s current fiscal-year earnings and sales indicates growth of 58.9% and 3.7%, respectively, from the year-ago actuals. GOOS delivered a trailing four-quarter average negative earnings surprise of 43.3%.
Designer Brands Inc. DBI designs, produces and retails footwear and accessories. It offers shoes, boots, sandals, sneakers, socks, handbags and accessories. It currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Designer Brands’ current fiscal-year earnings and sales suggests growth of 137.5% and 0.5%, respectively, from the year-ago actuals. DBI delivered a trailing four-quarter average earnings surprise of 112.8%.
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Tapestry, Inc. (TPR): Free Stock Analysis Report
Genesco Inc. (GCO): Free Stock Analysis Report
Canada Goose Holdings Inc. (GOOS): Free Stock Analysis Report
Designer Brands Inc. (DBI): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).