Tapestry CEO Sells 72,573 Shares for $9.6 Million to Cover Tax Obligations

Q: Can Tapestry's massive $1.3 billion buyback and rising dividends offset the recent stock drop despite consecutive earnings beats?

Not by themselves. Tapestry’s $1.3 billion buyback and higher dividend can support the stock, but they are unlikely to fully offset a drop driven by weaker forward revenue expectations and concern about the company’s reliance on Coach. The buyback is meaningful. At a roughly $26 billion market value, a $1.3 billion repurchase equals about 5% of the company, and recent data puts buyback yield near 5.5%. Combined with a dividend yield around 1.4%, shareholder yield is close to 7%. That gives the shares a valuation cushion and can lift earnings per share by shrinking the share count, especially since Tapestry generated about $1.86 billion in adjusted free cash flow and has modest leverage near 1.1x. The dividend also looks sustainable. The annual payout was raised 16% to $1.85 per share, and the payout ratio remains relatively low, leaving room for continued capital returns if cash flow holds up. But the recent selloff was about outlook, not backward-looking results. Tapestry beat earnings again, yet fiscal 2027 revenue guidance of roughly $8.4 billion to $8.5 billion was only around mid-single-digit growth and came in slightly below what investors wanted. The bigger issue is that Coach is doing most of the work while Kate Spade is still shrinking and expected to post a modest operating loss. So the buyback and dividend can help stabilize sentiment and support downside, but a durable rebound likely depends on Coach sustaining growth and Kate Spade showing clearer improvement.

1 articles · Updated · Yahoo Finance · Aug 22

$9.6 million of Tapestry stock was sold by CEO Joanne C. Crevoiserat on Aug. 19, according to an SEC Form 4 covering 72,573 shares.
The sale was non-discretionary: shares were withheld for taxes when awards vested, and additional shares were sold to cover stock-option exercise costs.
Crevoiserat still directly held 627,849 shares after the transaction, a stake valued at about $82.7 million based on Tapestry's Aug. 19 close of $131.72.
The filing came after Tapestry shares traded around $132.40 and posted a 35% one-year total return, with the company carrying a market value of roughly $26.6 billion.