Fossil Group is a global design, marketing and distribution company that specializes in consumer lifestyle and fashion accessories. The Company's principal offerings include an extensive line of men's and women's fashion watches and jewelry sold under a diverse portfolio of proprietary and licensed brands, handbags, small leather goods, accessories and apparel. The company was founded in 1984 and is based in Richardson, Texas.
FOSL Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Fossil Group Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Fossil Group Inc ranked in the 47th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. The most interesting components of our discounted cash flow analysis for Fossil Group Inc ended up being:
The company's debt burden, as measured by earnings divided by interest payments, is -5.23; that's higher than only 15.88% of US stocks in the Consumer Cyclical sector that have positive free cash flow.
The company's compound free cash flow growth rate over the past 5.73 years comes in at -0.06%; that's greater than only 17.23% of US stocks we're applying DCF forecasting to.
50% of the company's capital comes from equity, which is greater than merely 22.76% of stocks in our cash flow based forecasting set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as FOSL, try NYT, PKG, OMC, UONE, and FL.
Even for an experienced value investor, a risk that a top undervalued pick will turn out to be a value trap is always a gnawing concern. Today, I would like to take a closer look at a stock that might be called a value trap by bears, as there are...
Vasily Zyryanov on Seeking Alpha | October 2, 2020
Fossil (FOSL) is up 15.15% as investors breathe a sigh of relief after Apple's event yesterday featured news on the upcoming Watch series without any huge surprises.Shares of Fossil trade at their highest level of the year with the company seen being able to keep competing in the smartwatch category.Fossil's watch plans...