CPRI emerges from its August 5 earnings print with short sellers having trimmed positions in the days ahead of the release, even as analysts continued cutting targets and the stock trades nearly 13% lower over the past month.
The notable shift since last week's note is in short positioning. The previous article flagged SI climbing to 8.6% of the free float with shorts rebuilding; that trend reversed sharply into the print. Short interest now accounts for 8.2% of float — down 3.7% over the week, with roughly 340,000 shares covered since Monday. The direction has clearly flipped. Borrowing remains trivially cheap at 0.59%, up modestly from 0.47% a week ago but still well within "easy to short" territory. The more striking move is in availability, which has surged to 1,495% from around 1,008% last week — now at its highest level of the past year. For every share currently borrowed, roughly fifteen more are waiting in the lending pool. There is no squeeze dynamic here; the lending market is as loose as it has been in twelve months. Options positioning is slightly more cautious than usual — the put/call ratio is running at 0.52, around one standard deviation above its 20-day average of 0.48 — but that's a modest tilt, not an aggressive defensive stance.
The Street read coming into earnings was uniformly downbeat on price, even if most firms held their ratings. JP Morgan's Matthew Boss cut his target to $22 from $29 on August 4, just ahead of the print — the sharpest single-session trim among recent actions. That follows TD Cowen dropping to $20, Baird to $24, and Barclays to $20 earlier in the month. Every firm in the recent changes column lowered targets; not one raised. The mean analyst target is $24.16, implying around 46% upside from the current price of $16.52 — but given the sustained downward drift in those targets, the gap reflects cautious hope rather than near-term conviction. The bull case rests on improving full-price sales and higher average unit retails at Michael Kors, plus longer-term optionality at Versace. Bears point to the -6% YoY sales decline, a 5.4% operating margin, and tariff headwinds. The 90-day EPS momentum factor scores at the 93rd percentile — the one bright spot in the factor profile — but the 12-month forward earnings growth rank sits at just 26, suggesting the momentum is in estimate revisions rather than actual earnings trajectory.
The most recent comparable earnings event provided a clear precedent. The May 29 print produced a -6.8% single-day decline and a -4.4% move over the subsequent five days. The setup into that release had some parallels to the current one: targets already cut, a stock in retreat, and limited positive catalyst to offset the pressure. The stock closed at $16.52 ahead of Thursday's release, after recovering less than 1% on the day — essentially flat, with peers similarly mixed. VFC fell 16.5% over the same week, and COLM dropped 10.7%, suggesting the broader apparel complex faced its own headwinds regardless of company-specific news.
With the earnings result now effectively in the rear-view given the August 5 event time, the next session's price reaction — and particularly whether management commentary shifts the narrative on Michael Kors full-price sell-through or Versace growth timing — will determine whether the week's short covering was prescient or premature.
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