JPMorgan Starts Kontoor Brands (KTB) at Overweight

JPMorgan analyst Matthew Boss initiates coverage on Kontoor Brands (NYSE: KTB) with a Overweight rating and a price target of $90.00.

The analyst comments: “We are initiating coverage of Kontoor Brands (KTB) with an Overweight rating and $90 December 2027 price target. Importantly, we see the portfolio at an inflection point to accelerate growth into FY27, with a narrowed focus on function-based brands consisting of Wrangler (low-to-mid-single-digits+ revenue growth profile on core/replenishment denim + early innings Women’s/ DTC/Int’l growth) and Helly Hansen (“breakout” +double-digit growth opportunity into ’27), following the divestment of the Lee brand (announced 5/21). On the top-line, our model at +4% revenue growth through FY28 is prudently based on +3% Wrangler growth and high-single-digit Helly Hansen - each commensurate with their trailing twelve months profiles setting up beat & raise opportunity. On the bottom-line, ~20% adj. EBITDA margins by FY28 (= best in class vs. mid-teens% Apparel Global Brands average) and sector leading >100% FCF conversion by our model (underpinned by 23% operating margins at Wrangler fueling investments at the Helly Hansen brand) translates to a mid-teens(+) total shareholder return profile.”

For an analyst ratings summary and ratings history on Kontoor Brands click here. For more ratings news on Kontoor Brands click here.

Shares of Kontoor Brands closed at $70.07 yesterday.

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