June 12, 2013 at 10:54 AM EDT
Stifel Nicolaus Raises Price Target on VF Corp (VFC)

Stifel Nicolaus reported on Wednesday that it has raised its price target on apparel company, VF Corp (VFC).

The firm has reiterated a “Buy” rating on VFC, and has increased the company’s price target from $190 to $207. This price target suggests a 9% upside from the stock’s current price of $188.79.

An analyst from the firm commented, “yesterday, VF Corp hosted an Investor Day in NYC featuring growth objectives for 2017, an in-depth overview of long-term strategy, and discussion on key platforms and brands to drive growth. Financial objectives for 2017 include: $17.3bn in revenue (~10% CAGR) and $18.00 in EPS (~13% CAGR), driven by a 300bps increase in gross margin (49.5%) from 2012 to 2017 (management reiterated expectations for 100bps of expansion in 2013, implies 47.5%) and 250bps increase in operating margin (management reiterated expectations for 100bps of expansion in 2013, implies 14.5%). Revenue growth is expected to come from organic (8% CAGR) and acquisitions (2% CAGR). Cash flow from operations is targeted to increase to $2.4bn by 2017 from $1.3bn in 2012, and management highlighted priorities of cash as: 1) acquisitions in Outdoor & Action Sports, 2) a dividend payout ratio of 40% (implies $7.20 dividend per year in 2017), and 3) share repurchases.”

VF Corp shares were up 99 cents, or 0.53% during Wednesday morning trading. The stock is up 25% YTD.

The Bottom Line
Shares of VF Corp (VFC) have a 1.84% yield, based on Wednesday morning’s price of $189.53.

VF Corp (VFC) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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