Tags: coach | stock | price | sale

Coach Rises on Report of Speculation It’s Considering Sale

Wednesday, 27 Feb 2013 10:27 AM

 

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Coach Inc., the largest U.S. luxury-handbag maker, rose the most in more than four months after DealReporter said there is speculation the company may consider a sale.

The shares climbed 4.8 percent to $48.72 at 9:48 a.m. in New York and earlier rose as much as 5.4 percent for the biggest intraday gain since Oct. 23. The New York-based company slid 16 percent this year through Tuesday, compared with a 5.1 percent gain for the Standard & Poor’s 500 Consumer Discretionary Index.

Coach is speculated to be exploring a sale, DealReporter said, citing two bankers it didn’t name.

“I am not putting too much weight on” takeover speculation, said Corinna Freedman, an analyst with Wedbush Securities in New York. “I am not sure who would make sense for this.”

Coach’s large size limits the number of potential buyers and its small presence in Europe probably precludes interest from large European luxury companies, she said in an e-mail. Freedman rates Coach neutral, the equivalent of a hold.

The company’s North American same-store sales have declined amid economic pressure on consumers and growing competition from Michael Kors Holdings Ltd. Coach earlier this month said Victor Luis, head of its international business, would succeed Chief Executive Officer Lew Frankfort next year.

© Copyright 2014 Bloomberg News. All rights reserved.

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