Coach, Inc. Stock Analysis Coach, Inc. --

Coach, Inc. Stock Analysis

Coach, Inc. -- Stock Pick

Coach, Inc. (NYSE:COH) is a solid, long-term investment. The company produces high-end, luxury fashion and lifestyle accessories such as handbags, sunglasses, scarves, jewelry, shoes and other items. The brand is especially popular in the United States and Japan. Coach has a unique competitive advantage due to its 70-year legacy, name recognition, loyal customer base, and international appeal. The product line always emphasizes high end leathers, product detailing and finishes at affordable price points. Handbags are the company's flagship offering. Competitors include Kenneth Cole, Louis Vuitton, Dooney and Burke, Gucci, Fendi, and Prada. Each company carries handbags that offer comparable quality, but at prices well over $1,000. Coach targets an equally affluent and brand conscious demographic; however, the company is best known for "affordable luxury" with price points beginning at $300. This pricing strategy has proven to be a competitive advantage, particularly in the current recession.

Coach sells its product line through its own retail outlets and in higher end department stores. The primary customer base for its line of signature products is the middle to upper-middle class. Merchandise from past seasons is liquidated through factory outlet stores throughout the country and abroad which allows the company to capture the lower end of its target market. The company has a loyal following which makes it a solid investment. In addition, merchandising teams employ a customer-centric approach in designing products that is based upon consumer research and a solid understanding of the customer base.