V. F. Corp Crosses 50-Day SMA: Time to Buy the Stock or Hold Steady?

V. F. Corporation VFC stock has crossed its 50-day simple moving average (SMA) on May 12, 2025, indicating a short-term bullish trend. Yesterday, the VFC stock closed at $14.85, staying above the 50-day SMA of $13.92. The stock of this apparel retailer has been witnessing a significant uptrend in the past month, which resulted in crossing the 50-day SMA.

VFC Stock Crosses Above 50-Day SMA

The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as it is the first marker of an uptrend or a downtrend. SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. This approach provides a clearer perspective on a stock's long-term direction.

V. F. Corp has shown a robust performance, with its shares rallying 42.1% in the past month compared with the Zacks Textile - Apparel industry’s growth of 24.1%. Additionally, the VFC stock has outperformed the broader Zacks Consumer Discretionary sector and the S&P 500's growth of 16.4% and 11.4%, respectively, in the same period.

VFC’s performance is notably weaker than that of its competitors, Ralph Lauren Corporation RL, lululemon athletica inc. LULU and Guess Inc. GES, which have rallied 30.3%, 27% and 24.2%, respectively, in the past month.

V. F. Corp’s One-Month Price Performance

At its current price, VFC stock trades 48.8% below its 52-week high mark of $29.02 and 57.8% above its 52-week low of $9.41.

Is this the right time to stock up on V. F. Corp’s shares, or should you book profits? Let us delve deeper into the company’s fundamentals.

VFC’s Key Strengths: Strategic Overhaul Underway

V.F. Corp is making a decisive comeback. Once under pressure from shifting consumer trends and operational inefficiencies, the company is now steadily regaining investor confidence, thanks to the early successes of its "Reinvent" transformation plan, and a series of strategic pivots aimed at revitalizing its portfolio and sharpening execution.

At the heart of VFC’s rebound is a rigorous reset of its brand architecture, leadership and operational structure. The company has restructured key teams, streamlined operations and is aggressively focusing on its most promising brands, namely The North Face and Timberland, which posted impressive 5% and 11% revenue growth, respectively, in third-quarter fiscal 2025. These results helped lift total quarterly revenues by 2% year over year, marking a turning point in VFC’s narrative.

Even more notably, the Americas region, which has long been a lagging segment for VFC, returned to growth for the first time in over two years, signaling that market-specific strategies and channel optimization efforts are beginning to pay off.

The Reinvent strategy is also delivering measurable cost benefits. VFC achieved $300 million in gross cost savings so far, with plans to unlock $500-$600 million in operating income expansion by fiscal 2028. These efforts translated into a 150-basis-point (bps) expansion in the gross margin and a 360-bps boost in operating margin, now above 11%.

Additionally, VFC has reduced net debt by nearly $2 billion, reinforcing its commitment to financial health, and giving it greater flexibility for reinvestment and shareholder returns. The free cash flow guidance has also been raised to $440 million for fiscal 2025, a testament to improved operational discipline and inventory management.

Though the company anticipates a 4-6% decline in revenues for fourth-quarter fiscal 2025, management remains upbeat, stressing that the groundwork laid through Reinvent is setting the stage for sustainable growth and improved profitability in the years ahead.

Estimate Revision Trend for VFC

The Zacks Consensus Estimate for VFC’s fiscal 2025 EPS was unchanged in the last 30 days. The consensus estimate for fiscal 2026 EPS has moved down 3.8% in the past 30 days.

For fiscal 2025, the Zacks Consensus Estimate for V. F. Corp’s revenues implies an 8.6% year-over-year decline. The consensus mark for fiscal 2026 revenues and earnings suggests 1.8% and 38.6% year-over-year growth, respectively. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

VFC’s Premium Valuation

V. F. Corp trades at a significant premium to industry peers with a forward 12-month price-to-earnings (P/E) multiple of 13.95X. The current valuation is below its five-year high of 59.87X and ahead of the broader industry’s multiple of 12.75X. We believe that VFC’s valuation is too stretched at this time.

At 13.95X P/E, V. F. Corp is trading at a valuation much higher than its competitor, Guess’s 12-month P/E ratio of 6.53X. Though above Guess’s valuation, VFC trades below competitors Ralph Lauren and lululemon. Ralph Lauren and lululemon have forward 12-month P/E ratios of 19.52X and 20.79X, respectively.

Is VFC Stock a Smart Buy?

With operational efficiencies kicking in, key brands regaining traction and leadership laser-focused on execution, V. F. Corp is showing signs of a credible turnaround. While challenges remain, such as ongoing softness in Vans and macroeconomic headwinds, the company’s clear strategic direction and early wins have been enough to reignite investors’ interest, boosting its stock performance and painting a far more promising outlook than just a few quarters ago.

VFC’s premium valuation compared with industry peers raises valid concerns about its long-term sustainability, particularly amid a competitive landscape and ongoing economic uncertainty.

Nevertheless, supported by improving fundamentals and a cautiously optimistic outlook, this Zacks Rank #3 (Hold) stock remains one to keep on the radar. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research