By: Jennifer Spinka

Overview: Coach was founded in 1941 as a family-run workshop in a

Manhattan loft. Coach, Inc. designs and markets accessories and gifts for

women and men in the United States and internationally. It primarily offers handbags, women's and men's bag, accessories, business cases, footwear, wearable's, jewelry, sun wear, travel bags, watches, and fragrance products.

Key Factors: Price: $64.26 52 Week Range:

$45.70- $69.20 Market Cap:

$18.62B Dividend rate:

$.225 Fair Value: $55.00 P/E: 21.28

P/S: 4.70 P/B:11.5 EPS: (3 year

average):10.40

ROE: 35.36% Beta: 1.71

1 Year Chart:

S.W.O.T. :Strengths The company is one of the best recognized leather

goods brands in the U.S Known for product quality and durability and its

commitment to customer service Brand loyalty Global vision in place, Coach is available at over

• 970 department store locations in the US• 211 international department stores, retail store

and duty free shop locations in over 20 countries• 169 department store shop-in-shops and retail

and factory store locations operated by Coach Japan, Inc

Weaknesses Weak inventory turnover rates Men’s accessories, outerwear and

luggage combined only account for 7% of sales

Factory outlet stores are outperforming full-priced

Opportunity Increased wealth of consumers in

the Asian, Middle East, Australia, and Mexican Markets.

International Expansion

Threat: Strong competition from French and

Italian designers such as Gucci, Prada, & Louis Vuitton

Counterfeiting of luxury merchandise• Predicted that 500 billion worth of designer

merchandise was sold in 2006

Impacted by the economic down turn

Analyst’s Recommendation(Yahoofinance.com)

Total Number of Analysts: 29• Buy:8

• Outperform:13

• Hold:8

• Underperform:0

• Sell:0

Criteria Requirements: Company Industry Does it match our Criteria?Solvency and Financial Leverage Ratios: Current Ratio > 1 2.68 2.00 YesDebt Ratio < Industry Average 1.33 Efficiency Ratios: Total Asset Turnover > Industry Average 1.63 1.36 yesInventory Turnover > Industry Average 2.89 5.05 noProfitability Ratios: Net Profit Margin > Industry Average 21.11 7.06 yesReturn on Asset (ROA) > Industry Average 30.55 12.01 yesReturn on Equity (ROE) > Industry Average 53.36 20.50 yesGrowth Ratio (5 years): Historical EPS Growth > Industry Average 19.59 11.36 yesHistorical Revenue Growth > Industry Average 8.54 Projected EPS Growth >10%* and > industry Average Other Informative Data: P/E 21.28 22.17 P/B 9.99 4.29 PEG 1.27 1.17 Fair Value Estimate 55.00 Over valuedCurrent Price (10/17/2011) 64.26

Dividend .225

Recommendation: Set a buying price between $56.00- $58.00 buy 40 shares

(costing between $2240.00-$2320) Reasons:

• They are a good long-term stable company, they have been around for 70 years

• They are continuing to expand into growing markets such as China and plan to opened 25

• They have little debt on their balance sheet and are able to turn 20% of sales into free cash flow for continued expansion

• They have been increasing their dividends over the past 3 years and are predicted to continue.

• The major highlights of the most recent three-month period were

impressive performance in Coach’s North American and Chinese businesses along with a strong double digit increase in internet sales