Does The North Face's Strength and Gross Margin Progress Signal Real Turnaround Momentum for VF Corp (VFC)?

• VF Corp recently reported quarterly earnings that exceeded expectations, with standout sales growth from The North Face and Timberland brands helping to offset weaker performance at Vans.
• The company’s progress in improving gross margins and narrowing operating losses points to strengthening results from its transformation efforts and increased investor attention on its turnaround plan.
• We’ll examine how the latest improvements in gross margin and brand performance may influence VF Corp’s evolving investment narrative.

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V.F Investment Narrative Recap

To be a VF Corp shareholder today, you need confidence that its turnaround plan can sustainably rebuild earnings and restore growth in struggling brands, especially Vans. The recent earnings surprise and stronger gross margin are encouraging but do not immediately resolve concerns about execution risks or persistent underperformance at key legacy brands, which remain the dominant catalyst and risk in the short term.

Among the company’s recent updates, the amended $2.25 billion revolving credit facility stands out, as improved financial flexibility can support ongoing transformation initiatives. Nevertheless, continued vigilance around brand recovery and margin pressures remains warranted if the revenue turnaround does not materialize as quickly as hoped.

By contrast, one persistent challenge that investors should be aware of involves the sustained revenue declines at Vans, where failing to reignite brand momentum could…

Read the full narrative on V.F (it's free!)

V.F's outlook anticipates $10.3 billion in revenue and $571.3 million in earnings by 2028. This is based on a projected annual revenue growth rate of 2.6% and a $466.4 million increase in earnings from the current $104.9 million.

Uncover how V.F's forecasts yield a $14.89 fair value, a 9% upside to its current price.

Exploring Other Perspectives

Six distinct fair value estimates from the Simply Wall St Community for VF Corp range from US$14.89 to US$27.06 per share. With this diversity of opinion, it’s important to weigh both broad optimism about margin improvement and the ongoing uncertainty around brand recovery plans when evaluating possible outcomes.

Explore 6 other fair value estimates on V.F - why the stock might be worth as much as 98% more than the current price!

Build Your Own V.F Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your V.F research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free V.F research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate V.F's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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