TPR heads into its May 7 earnings call with short sellers adding exposure for the first time in weeks — even as the Street keeps raising its price targets.
Short interest is the week's defining tension. It rose 6.8% in seven days to 6% of the free float — roughly 12.4 million shares — reversing a sharp pullback in mid-April when positions briefly dipped toward 11.5 million shares. The rebuild has been rapid. From April 23 to April 24 alone, short exposure jumped by nearly 1 million shares. The ORTEX short score lifted to 45.1 from around 43.4 at the start of the week, a meaningful one-week move even if the absolute score remains mid-range. Days to cover are just 1.3, so this is not a heavily trapped position — shorts can exit quickly if they need to. The lending market stays relaxed: cost to borrow has actually eased back to 0.34%, well below the 0.50% level touched earlier in April, and availability is not tight by any measure. Nothing in the borrow market suggests a squeeze setup.
Options positioning is slightly less defensive than usual heading into the print. The put/call ratio has edged down to 0.95, a touch below its 20-day average of 0.98 — a mild negative z-score of –1.3, meaning call activity is running marginally above trend. That is a contrast to the more cautious posture visible earlier in April when the PCR was consistently above 1.00. The options market is not screaming either fear or conviction here; it is closer to neutral.
The Street, however, is sending a clearer message. Analyst target upgrades have come in from multiple directions this week. Citi lifted its target to $170 with a Buy maintained; Baird moved to $165 on an Outperform; BTIG earlier in the week pushed to $180, also Buy. None of these are downgrades. The consensus mean price target runs at roughly $162, implying about 13% upside to Tuesday's close of $143.84. Valuation multiples have nudged higher over the past 30 days — PE has expanded modestly and EV/EBITDA has ticked up — reflecting the stock's roughly 3.6% gain over the past month even as it gave back 4.4% this week. The bear case centres on tariff headwinds: management has flagged around 200 basis points of gross margin pressure this fiscal year, with some drag expected to persist into Q3. Bulls point to Coach's continued brand strength, operating margin expansion — already 380 basis points YoY at 28.8% — and the potential for international market share gains. EPS momentum is strong over a 90-day window, ranked in the 81st percentile.
The February earnings reaction is worth keeping in mind. When Tapestry last reported, the stock jumped 17% on the day and held most of those gains over the following week. That print followed the abandoned Capri Holdings merger, which freed management to focus on buybacks and brand investment. The May 7 report arrives with the stock still up nearly 13% year-to-date but having pulled back meaningfully from recent highs. Peers have broadly tracked lower this week: RL lost 5.1%, LEVI fell 4.5%, and AS dropped 3.7% — so this week's TPR decline is a sector-wide move, not a company-specific warning.
What to watch on May 7 is whether management provides any update on how effectively it is offsetting tariff costs through pricing and re-sourcing, and whether Coach's Q3 revenue trend held the momentum that drove February's upside surprise.
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