Coach Stock Investment

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| Stock Analysis | | | | FINA 6203 Investment Analysis – Section 5 | Summary About The Company Coach, Inc. was founded in 1941 as a family-run workshop in Manhattan where artisans made leather belts and wallets. In 1962, co-founder Miles Cahn commissioned the creation of the company’s first handbag. The company’s reputation grew steadily over the next 20 years and was positioned firmly in the niche market of making quality leather goods. In 1979, current CEO, Lewis Frankfort joined Coach as vice president of new business development. He began Coach’s catalog business as the popularity of buying product by mail was on the rise. Subsequently, in 1981, he opened Coach’s first retail store on Madison Avenue in New York City. In 1985, Coach sales reached $19 million, with roughly 10% from the store on Madison Avenue. Coach’s success drew attention from Sara Lee, who bought the company for $30 million in 1985, and, in turn, made Frankfort an executive. The company grew steadily under Sara Lee and Frankfort, but Frankfort also was focused on other Sara Lee business. However, after 10 years of working on various brands, Frankfort stated he wanted to focus solely on his original company and was made CEO of Coach. In 1996, Frankfort hired Reed Krakoff as Executive Creative Director. Krakoff had begun his career as a designer at Polo Ralph Lauren, and was most recently credited with increasing annual sales from $80 million to $1 billion as the creative director at Tommy Hilfiger. Upon his arrival, sales at Coach were about $500 million annually and the average consumer was about 40 years old. In 1999, under direction of Frankfort and Krakoff, coach repositioned itself as a maker of leather goods to a company focused on making a “modern, fashionable, brand.” New products, in a broader array of materials, were introduced to respond to

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