VFC: Push It Real Good; Vans Inflection Pushed Out, Story Gets Tougher in NT, Lower PT to $18

研报英文原文证据摘录

VFC: Push It Real Good; Vans Inflection Pushed Out, Story Gets Tougher in NT, Lower PT to $18

V.F. Corporation Equity Research

Investment Thesis

Key themes surrounding the company include:

1. CEO (and Turnaround Specialist) Looks to Make His Mark. CEO Bracken Darrell was appointed

CEO in July 2023, tasked with turning around a struggling VFC (with a track record of success

at Old Spice & Logitech). Since then, he made several C-Suite additions, including: CFO (Paul

Vogel, former CFO at Spotify) and President of Vans (Sun Choe, former Chief Product Officer at

LULU), and a new president of The North Face replacing Caroline Brown (Chris Goble). Bracken

believes VFC is now moving into Phase 2 of his “Reinvent” transformation program which includes:

1) improving North America/US business; 2) turning around the Vans brand (still a WIP); 3) de-

levering the balance sheet—this remains the #1 financial priority for the company going forward

(VFC is making solid progress here, ending FY26 at 2.9x Net Debt to EBITDAR with another half

turn expected for FY27E); and 4) reducing the cost structure, reallocating marketing to higher

ROI initiatives, and improving speed-to-market for new product to react to and capture demand

signals.

2. Vans Remains the Key Cog in a Turnaround. Once a darling of the footwear industry with growth

averaging 25-30% for several quarters pre-COVID, Vans has struggled since the start of FY23,

and evidence of a brand turnaround has thus far been largely absent. While management has been

clear that it is not focused on a quick turnaround, but building for a longer-term, there is limited

visibility from the investor standpoint into whether the actions are having the intended positive

impact on driving higher full-priced sales growth.