When you look at NYSE:TPR, it's hard to ignore the strong fundamentals, especially considering its likely undervaluation.

Last update: Jun 4, 2024

Our stock screening tool has pinpointed TAPESTRY INC (NYSE:TPR) as an undervalued stock option. NYSE:TPR retains a strong financial foundation and an attractive price tag. Let's delve into the specifics below.

Exploring NYSE:TPR's Valuation

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NYSE:TPR scores a 8 out of 10:

TPR is valuated reasonably with a Price/Earnings ratio of 10.25.
92.00% of the companies in the same industry are more expensive than TPR, based on the Price/Earnings ratio.
TPR is valuated cheaply when we compare the Price/Earnings ratio to 27.88, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 9.69 indicates a reasonable valuation of TPR.
Based on the Price/Forward Earnings ratio, TPR is valued cheaper than 94.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 19.97, TPR is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, TPR is valued a bit cheaper than 80.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, TPR is valued a bit cheaper than the industry average as 78.00% of the companies are valued more expensively.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
TPR has an outstanding profitability rating, which may justify a higher PE ratio.

How do we evaluate the Profitability for NYSE:TPR?

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:TPR has earned a 8 out of 10:

Looking at the Return On Assets, with a value of 6.42%, TPR is in the better half of the industry, outperforming 72.00% of the companies in the same industry.
Looking at the Return On Equity, with a value of 31.74%, TPR belongs to the top of the industry, outperforming 86.00% of the companies in the same industry.
TPR had an Average Return On Invested Capital over the past 3 years of 15.58%. This is above the industry average of 10.77%.
The 3 year average ROIC (15.58%) for TPR is well above the current ROIC(7.80%). The reason for the recent decline needs to be investigated.
The Profit Margin of TPR (13.15%) is better than 92.00% of its industry peers.
In the last couple of years the Profit Margin of TPR has grown nicely.
TPR has a better Operating Margin (17.59%) than 92.00% of its industry peers.
In the last couple of years the Operating Margin of TPR has grown nicely.
TPR's Gross Margin of 72.71% is amongst the best of the industry. TPR outperforms 100.00% of its industry peers.
In the last couple of years the Gross Margin of TPR has grown nicely.

How do we evaluate the Health for NYSE:TPR?

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:TPR, the assigned 5 reflects its health status:

A Current Ratio of 6.59 indicates that TPR has no problem at all paying its short term obligations.
TPR's Current ratio of 6.59 is amongst the best of the industry. TPR outperforms 100.00% of its industry peers.
A Quick Ratio of 5.98 indicates that TPR has no problem at all paying its short term obligations.
TPR has a Quick ratio of 5.98. This is amongst the best in the industry. TPR outperforms 100.00% of its industry peers.

Understanding NYSE:TPR's Growth Score

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:TPR was assigned a score of 5 for growth:

TPR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.44%, which is quite good.
Measured over the past years, TPR shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.09% on average per year.
Based on estimates for the next years, TPR will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.58% on average per year.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Our latest full fundamental report of TPR contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.