Yahoo Finance Understanding Capri Holdings (CPRI) Reliance on International Revenue
Have you looked into how Capri Holdings (CPRI) performed internationally during the quarter ending March 2024? Considering the widespread global presence of this luxury retailer, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.
The global economy today is deeply interlinked, making a company's engagement with international markets a critical factor in determining its financial success and growth path. It has become essential for investors to comprehend how much a company relies on these foreign markets, as this understanding reveals the firm's potential for consistent earnings, its capacity to harness different economic cycles, and its overall growth prospects.
Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.
In our recent assessment of CPRI's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.
The recent quarter saw the company's total revenue reaching $1.22 billion, marking a decline of 8.4% from the prior-year quarter. Next, we'll examine the breakdown of CPRI's revenue from abroad to comprehend the significance of its international presence.
Trends in CPRI's Revenue from International Markets
Europe accounted for 28.8% of the company's total revenue during the quarter, translating to $352 million. Revenues from this region represented a surprise of -1.15%, with Wall Street analysts collectively expecting $356.08 million. When compared to the preceding quarter and the same quarter in the previous year, Europe contributed $376 million (26.4%) and $383 million (28.7%) to the total revenue, respectively.
During the quarter, Asia contributed $224 million in revenue, making up 18.3% of the total revenue. When compared to the consensus estimate of $232.92 million, this meant a surprise of -3.83%. Looking back, Asia contributed $208 million, or 14.6%, in the previous quarter, and $248 million, or 18.6%, in the same quarter of the previous year.
International Market Revenue Projections
Wall Street analysts expect Capri Holdings to report $1.17 billion in total revenue for the current fiscal quarter, indicating a decline of 5% from the year-ago quarter. Europe and Asia are expected to contribute 30% ($350.5 million) and 16.2% ($188.79 million) to the total revenue, respectively.
Analysts expect the company to report a total annual revenue of $5.05 billion for the full year, marking a decrease of 2.3% compared to last year. The expected revenue contributions from Europe and Asia are projected to be 29.3% ($1.48 billion) and 16.5% ($832.85 million) of the total revenue, in that order.
Key Takeaways
Capri Holdings' leaning on foreign markets for its revenue stream presents a mix of chances and challenges. Therefore, a vigilant watch on its international revenue movements can greatly aid in projecting the company's future direction.
In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' earnings forecasts.
Emphasizing a company's shifting earnings prospects is a key aspect of our approach at Zacks, especially since research has proven its substantial influence on a stock's price in the short run. This correlation is positively aligned, meaning that improved earnings projections tend to boost the stock's price.
The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.
Capri Holdings, bearing a Zacks Rank #5 (Strong Sell), is expected to underperform the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
A Look at Capri Holdings' Recent Stock Price Performance
The stock has witnessed a decline of 6.3% over the past month versus the Zacks S&P 500 composite's an increase of 3.5%. In the same interval, the Zacks Retail-Wholesale sector, to which Capri Holdings belongs, has registered an increase of 0.2%. Over the past three months, the company's shares saw a decrease of 27.6%, while the S&P 500 increased by 5.2%. In comparison, the sector experienced an increase of 2.1% during this timeframe.
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Capri Holdings Limited (CPRI) : Free Stock Analysis Report
