Kontoor Brands (NYSE:KTB) Announces Earnings Results, Misses Expectations By $0.11 EPS

Kontoor Brands (NYSE:KTB) released its quarterly earnings results on Thursday. The company reported $1.06 EPS for the quarter, missing analysts’ consensus estimates of $1.17 by ($0.11), Zacks reports. The company had revenue of $613.32 million during the quarter, compared to analysts’ expectations of $784.76 million. Kontoor Brands had a net margin of 8.81% and a return on equity of 55.20%. The company’s quarterly revenue was up 45.0% compared to the same quarter last year. During the same period in the previous year, the company posted $1.20 earnings per share. Kontoor Brands updated its FY 2026 guidance to 6.600-6.700 EPS.

Here are the key takeaways from Kontoor Brands’ conference call:

• Kontoor announced it will divest the Lee brand to sharpen focus on Wrangler and Helly Hansen; the company says the competitive sale process has attracted strong interest and it expects to enter an agreement later this year.
• First-quarter results were strong: adjusted EPS rose 67% to $1.06 and adjusted gross margin expanded 470 basis points to 50.6%, with Helly Hansen contributing about $0.26 per share and ~200 bps of margin accretion.
• Lee is now reported as discontinued operations, which shifts roughly $40 million of unmitigated expenses onto continuing operations in the near term, though management expects the divestiture to be “immaterial to EPS” over 12–18 months as overhead mitigation and capital deployment offset the impact.
• Management positions Helly Hansen as a growth engine — Q1 pro forma revenue rose >20% including the China JV — and plans accelerated investment in the U.S., Alps, technical outdoor and footwear to reach a mid?teens operating margin over time.

Kontoor Brands Stock Performance

NYSE:KTB traded down $4.60 during trading on Friday, reaching $73.47. The company’s stock had a trading volume of 1,224,515 shares, compared to its average volume of 679,903. Kontoor Brands has a 12 month low of $53.55 and a 12 month high of $87.00. The firm has a 50 day moving average of $71.26 and a 200-day moving average of $69.29. The company has a debt-to-equity ratio of 1.83, a quick ratio of 0.87 and a current ratio of 1.87. The firm has a market cap of $4.06 billion, a price-to-earnings ratio of 14.87 and a beta of 0.91.

Kontoor Brands Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, June 18th. Shareholders of record on Monday, June 8th will be paid a $0.53 dividend. This represents a $2.12 dividend on an annualized basis and a yield of 2.9%. The ex-dividend date is Monday, June 8th. Kontoor Brands’s dividend payout ratio is 42.91%.

Wall Street Analysts Forecast Growth

KTB has been the subject of a number of analyst reports. Wells Fargo & Company increased their price target on Kontoor Brands from $95.00 to $100.00 and gave the company an “overweight” rating in a research report on Wednesday, March 4th. BTIG Research reissued a “buy” rating and issued a $100.00 price target on shares of Kontoor Brands in a research report on Friday, May 1st. Zacks Research raised Kontoor Brands from a “hold” rating to a “strong-buy” rating in a research report on Thursday, April 16th. UBS Group increased their price target on Kontoor Brands from $118.00 to $131.00 and gave the company a “buy” rating in a research report on Wednesday, March 4th. Finally, Stifel Nicolaus increased their price target on Kontoor Brands from $75.00 to $80.00 and gave the company a “hold” rating in a research report on Tuesday, March 3rd. Two equities research analysts have rated the stock with a Strong Buy rating, five have given a Buy rating, three have given a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, Kontoor Brands currently has a consensus rating of “Moderate Buy” and an average price target of $91.00.

Institutional Trading of Kontoor Brands

A number of large investors have recently added to or reduced their stakes in the stock. Parkside Financial Bank & Trust increased its holdings in Kontoor Brands by 12.3% during the fourth quarter. Parkside Financial Bank & Trust now owns 1,436 shares of the company’s stock worth $88,000 after buying an additional 157 shares during the last quarter. Bank of Montreal Can increased its holdings in Kontoor Brands by 1.8% during the fourth quarter. Bank of Montreal Can now owns 9,297 shares of the company’s stock worth $568,000 after buying an additional 164 shares during the last quarter. Stifel Financial Corp increased its holdings in Kontoor Brands by 0.8% during the fourth quarter. Stifel Financial Corp now owns 24,710 shares of the company’s stock worth $1,510,000 after buying an additional 199 shares during the last quarter. Corient Private Wealth LLC increased its holdings in Kontoor Brands by 2.8% during the fourth quarter. Corient Private Wealth LLC now owns 10,402 shares of the company’s stock worth $636,000 after buying an additional 280 shares during the last quarter. Finally, Transamerica Financial Advisors LLC increased its holdings in Kontoor Brands by 335.5% during the fourth quarter. Transamerica Financial Advisors LLC now owns 405 shares of the company’s stock worth $25,000 after buying an additional 312 shares during the last quarter. Hedge funds and other institutional investors own 93.06% of the company’s stock.

Kontoor Brands News Roundup

Here are the key news stories impacting Kontoor Brands this week:

• Positive Sentiment: Kontoor reported stronger-than-expected Q1 adjusted earnings and raised its full-year outlook, signaling improving profitability and confidence in the business. Business Wire article
• Positive Sentiment: The company said revenue rose 45% year over year, helped by strong Helly Hansen performance and Wrangler market-share gains, which suggests core brand momentum. Business Wire article
• Positive Sentiment: Management announced a planned divestiture of the Lee brand and a $750 million share repurchase program, moves that could streamline the portfolio and support shareholder returns. Business Wire article
• Neutral Sentiment: Some early coverage emphasized that quarterly revenue missed Wall Street estimates even though earnings beat expectations, which may be limiting enthusiasm. Zacks article

Kontoor Brands Company Profile

Kontoor Brands, Inc is a global apparel company best known for its Wrangler and Lee denim and lifestyle brands. Established as an independent, publicly traded company in May 2019 following a spin-off from VF Corporation, Kontoor leverages a legacy that dates back to 1889 with the founding of Lee and to 1947 with the introduction of the Wrangler brand. The company focuses on designing, manufacturing and distributing premium, casual and workwear apparel, including jeans, pants, shorts, shirts, jackets and complementary accessories.

Kontoor Brands operates a diversified sales model that combines wholesale partnerships with leading retailers, distribution through e-commerce channels and select direct-to-consumer formats.