Last Update 06 Jan 26

VFC: Future Returns Will Hinge On Prolonged Vans Weakness Despite Sector Tailwinds

Analysts have nudged their fair value estimate for V.F. shares slightly higher, reflecting a modestly increased average Street price target in the mid-teens to low US$20s range, as they balance cautious views on Vans with more constructive opinions on other brands and the broader specialty retail sector.

Analyst Commentary

Street research on V.F. is mixed, with most firms nudging price targets higher but stopping short of a consensus bullish stance. The key debate centers on execution at Vans versus steadier performance at other brands and how that feeds into what investors are willing to pay for the stock in the mid-teens to low US$20s range.

Bullish Takeaways

Bullish analysts see room for upside in the specialty retail sector into 2026, pointing to tighter inventory discipline and potential support from lower interest rates and gas prices, which could support higher valuation multiples if execution holds.
Several firms raised price targets into a US$14 to US$21 band, which signals improved confidence in the risk or reward skew even as ratings stay more balanced between Overweight, Neutral, Hold and Underperform.
Some research points to relative strength at The North Face and Timberland, with expectations for sales trends around a low single digit decline, which could help offset Vans weakness and support overall cash generation and balance sheet flexibility.
Estimate revisions around the Fashion Brands group suggest that, at least for some analysts, recent earnings and outlook updates reduce the probability of more severe downside scenarios being priced into V.F. shares.

Bearish Takeaways

Bearish analysts and some Neutral voices highlight ongoing softness at Vans, with underlying trends described as high single digit declines even after reset actions, which keeps pressure on growth expectations and limits enthusiasm for multiple expansion.
One firm explicitly downgraded the stock to Neutral with a price target around the mid-teens, reflecting concern that current valuation already captures much of the near term recovery potential without clear evidence of a turnaround at Vans.
Several reports flag continued declines expected through Q3 at Vans, which effectively pushes out any timeline for a more durable inflection, keeping execution risk elevated and leaving the brand as a key overhang for the broader group.
A major bank maintains an Underperform rating even after raising its price target to US$14, stating limited confidence in a near term Vans turnaround, which serves as a reminder that higher targets do not necessarily translate into bullish stances on the shares.

What's in the News

V.F. issued revenue guidance for the third quarter of 2026, calling for revenue in a CAD 3% to CAD 1% decline range versus the prior year. This provides a clearer view of what management is signaling for near-term demand (company guidance).
The company reported that, from June 29, 2025 to September 27, 2025, it repurchased 0 shares for $0 million, while confirming that it has completed repurchases of 36,028,885 shares, or 9.01%, for $2,513 million under the buyback program announced on March 30, 2017 (company filing).

Valuation Changes

Fair Value Estimate, unchanged at US$16.95 per share. This indicates no adjustment to the central value anchor used in this framework.
Discount Rate, edged slightly lower from 10.92% to 10.87%. This marginally reduces the hurdle rate applied to future cash flows.
Revenue Growth, effectively steady at about 1.27%, with only a very small numerical tweak that does not change the overall growth assumption.
Net Profit Margin, effectively unchanged at about 7.09%, with immaterial rounding differences in the updated figure.
Future P/E Multiple, adjusted fractionally from 12.97x to 12.95x, leaving the broad valuation multiple assumption intact.

Focus on premiumization, digital sales, and product innovation is driving higher margins, deeper customer engagement, and sustainable long-term growth.
Portfolio streamlining, supply chain improvements, and international expansion support stronger earnings, cash flow, and reduced exposure to struggling legacy brands.
Declining brand performance, execution risks, tariff pressures, high leverage, and uncertain consumer demand all threaten profitability and limit V.F.'s ability to invest for future growth.

Catalysts

About V.F

Offers branded apparel, footwear, and accessories for men, women, and children in the Americas, Europe, and the Asia-Pacific.What are the underlying business or industry changes driving this perspective?

The strategic focus on expanding higher-margin channels, including direct-to-consumer and e-commerce, is beginning to drive improved gross margins and deeper customer engagement-expected to lift both revenue growth and net margins over time as V.F. capitalizes on the sustained consumer shift toward digital and premium shopping experiences.
V.F. is leveraging the accelerated global demand for athleisure, technical, and outdoor apparel, evidenced by strong performance from brands like The North Face, Timberland, and Altra, and investing in product innovation and premiumization-setting the stage for long-term, top-line growth and premium pricing opportunities.
Executing a broad portfolio reset-consolidating around high-potential brands and optimizing store network-should lead to a structurally leaner cost base and higher-quality revenues, supporting increased operating income and improved earnings despite legacy pressures from struggling banners like Vans.
The company's supply chain and inventory transformation is directly reducing markdowns and discounts, which, when combined with improved inventory quality and more responsive merchandising, is expected to drive further margin expansion and stronger free cash flow generation.
Investments in international markets, particularly Asia-Pacific, where middle-class growth and appetite for branded goods remain strong, position V.F. to capture incremental revenues and diversify geographic risk, magnifying the earnings impact as global discretionary spending power grows.

V.F Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming V.F's revenue will grow by 2.6% annually over the next 3 years.
Analysts assume that profit margins will increase from 1.1% today to 5.6% in 3 years time.
Analysts expect earnings to reach $571.3 million (and earnings per share of $1.47) by about September 2028, up from $104.9 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $641.8 million in earnings, and the most bearish expecting $393 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 14.4x on those 2028 earnings, down from 55.2x today. This future PE is lower than the current PE for the US Luxury industry at 20.5x.
Analysts expect the number of shares outstanding to grow by 0.33% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 11.16%, as per the Simply Wall St company report.

V.F Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Persistent double-digit revenue declines at Vans, the largest brand in V.F.'s portfolio, highlight ongoing brand equity and innovation challenges, risking prolonged revenue stagnation and drag on overall company earnings.
Heavy reliance on turnaround execution and optimistic premiumization opportunities at key brands (e.g., North Face, Timberland, Vans) exposes V.F. to execution risk if new products or marketing strategies fail to translate into sustainable growth, impacting long-term revenue and margin expansion.
The company faces significant tariff headwinds ($250–$270 million annualized impact), with uncertainty around the timing and effectiveness of cost mitigation, pricing actions, and elasticity effects, increasing the risk of gross margin pressure and potential volume declines in the medium term.
Elevated debt levels and higher leverage (currently over 4x, with a target of 2.5x by 2028) continue to constrain financial flexibility, making future investments in growth, innovation, or shareholder returns more challenging if cash flow improvements do not materialize as planned.
Industry-wide inventory and wholesale demand caution, especially amid uncertain macroeconomic conditions and shifting fashion/lifestyle trends, amplify the risk of overstocking, forced discounting, and margin erosion-ultimately threatening profitability and future earnings power.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $15.19 for V.F based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $40.0, and the most bearish reporting a price target of just $10.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $10.3 billion, earnings will come to $571.3 million, and it would be trading on a PE ratio of 14.4x, assuming you use a discount rate of 11.2%.
Given the current share price of $14.82, the analyst price target of $15.19 is 2.4% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

Have other thoughts on V.F?

Create your own narrative on this stock, and estimate its Fair Value using our Valuator tool.

Create Narrative

How well do narratives help inform your perspective?

Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Analysts Weigh V.F. Corporation Outlook Amid Price Target Increase and Ongoing Brand Challenges