KTB

Analyst Coverage Initiation: Barclays analyst Paul Kearney initiated coverage on several companies, including Gildan Activewear with a price forecast of $51, Macy's and Columbia Sportswear with forecasts of $12 and $64 respectively, while giving Underweight ratings to Carter’s and Kohl's with forecasts of $25 and $4.

Market Outlook and Recommendations: Kearney expresses caution regarding the apparel sector due to market turbulence and tariff policy shifts, predicting a decline in unit sales in late 2025 and early 2026, and recommends focusing on companies that enhance their direct-to-consumer strategies and maintain operational advantages to mitigate risks.

Dividend Announcement: Kontoor Brands (KTB) has declared a quarterly dividend of $0.52 per share, maintaining the same rate as previous quarters, with a forward yield of 3.78%. The dividend is payable on June 20 to shareholders of record by June 10.

Earnings Performance: In its recent earnings report, Kontoor Brands reported a non-GAAP EPS of $1.38, beating expectations by $0.03, and revenue of $699 million, surpassing estimates by $0.93 million, despite lower full-year guidance causing the stock to trade lower.

Impact of U.S. Tariffs on Retail: Goldman Sachs analyst Brooke Roach highlighted that the recent reciprocal tariffs announced by President Trump will significantly affect retail companies, particularly those sourcing from countries like Vietnam, Indonesia, and China, with apparel and footwear tariffs expected to average 38%.

Vulnerability and Resilience Among Retailers: Companies with high exposure to these tariffs, such as home furnishings and certain sportswear brands, face greater risks, while retailers with lower reliance on international sourcing or strong consumer engagement, like Walmart and Ulta Beauty, are better positioned to withstand the impact.