Kontoor Brands Posts Strong Q4 Preliminary Results: What's More?

Kontoor Brands, Inc. KTB announced its preliminary results for the fourth quarter of fiscal 2024, indicating strong performance, strategic execution and growth potential. The company delivered better-than-expected revenues, earnings and cash flow, reinforcing its momentum heading into 2025.The global lifestyle apparel company attributes its strong results to strategic investments, operational efficiencies and brand strength. Leveraging the momentum from Project Jeanius and the newly unveiled acquisition of Helly Hansen, KTB remains well-positioned to generate strong returns and enhance value heading into 2025.Shares of Kontoor Brands, whose portfolio is led by two of the world’s most iconic consumer brands, Wrangler and Lee, rose 4.1% during the trading session yesterday. In the past six months, shares of KTB have gained 23.7% compared with the industry’s growth of 22.8%.KTB Stock Past Six Months' Performance Image Source: Zacks Investment Research Kontoor Brands’ Strong Q4 Preliminary ResultsKontoor Brands’ preliminary results for the fourth quarter, ending Dec. 28, 2024, show total revenues of approximately $699 million, up from $670 million in the fourth quarter of fiscal 2023, representing a 4% year-over-year increase (5% on a constant-currency basis).The company’s preliminary adjusted gross profit for the quarter was $313 million, up from $283 million in the prior year. Adjusted gross margin improved to 44.7%, indicating a 160-basis-point increase, excluding the out-of-period duty charge in that period, while GAAP gross margin was 43.7%.Adjusted earnings per share (EPS) reached $1.38, indicating a 2% increase from the previous year on an adjusted basis, excluding the prior period's out-of-period duty charge. The previous year’s adjusted EPS had also benefited from a one-time tax advantage. When excluding these factors, fourth-quarter adjusted EPS saw robust growth of around 23%. On a GAAP basis, reported earnings were $1.14 per share.KTB’s Full-Year MetricsCash flow from operations totaled $368 million for fiscal 2024, highlighting the company's ability to generate robust liquidity. Moreover, year-end inventory was $390 million, indicating a 22% decrease compared with the prior year.Kontoor Brands’ Strategic Focus for Sustainable GrowthKontoor Brands is driving growth through product innovation, market expansion and supply-chain optimization. On its third-quarter of fiscal 2024 earnings call, management highlighted that the company’s investments in Project Jeanius aim to enhance operational efficiency and unlock $100 million in cost savings. The company is also focused on category expansion, direct-to-consumer growth and new distribution channels, which will further solidify its global presence. Moreover, leveraging data analytics and digital platforms remains a key priority to enhance customer engagement and drive e-commerce momentum.Another key pillar of Kontoor Brands’ strategy is brand enhancement and consumer-driven marketing. Wrangler and Lee continue to gain market share, supported by collaborations, refreshed brand positioning and strategic partnerships. The recent acquisition of Helly Hansen aligns with KTB’s long-term vision to expand into high-performance apparel. The company is investing in global supply-chain transformation to improve efficiency and ensure faster speed to market.KTB’s Investment AnalysisWith a robust fourth quarter of fiscal 2024 preliminary performance, Kontoor Brands continues to demonstrate resilience and strategic growth in the apparel industry. Its focus on brand expansion, digital transformation and operational efficiencies supports long-term value creation. The acquisition of Helly Hansen and investments in Project Jeanius further strengthen its competitive positioning. Currently, Kontoor Brands carries a Zacks Rank #3 (Hold).Three Solid PicksRalph Lauren Corporation RL designs, markets and distributes lifestyle products in North America, Europe, Asia and internationally. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The Zacks Consensus Estimate for Ralph Lauren’s current fiscal-year sales and earnings indicates growth of 5.8% and 16.5%, respectively, from the previous year’s reported number. RL delivered a trailing four-quarter average earnings surprise of 6.5%.lululemon athletica inc. LULU designs, distributes and retails athletic apparel, footwear and accessories under the lululemon brand for women and men. The company presently carries a Zacks Rank #2. LULU delivered a trailing four-quarter average earnings surprise of 6.7%.The Zacks Consensus Estimate for lululemon athletica’s current fiscal-year sales and earnings indicates growth of 9.7% and 12.5%, respectively, from the previous year’s reported figures.Hanesbrands Inc. HBI designs, manufactures, sources and sells a range of innerwear apparel for men, women and children in the Americas, Europe, the Asia Pacific and internationally. It currently has a Zacks Rank #2. HBI delivered a trailing four-quarter average earnings surprise of 43.6%.The Zacks Consensus Estimate for Hanesbrands’ current fiscal-year earnings indicates growth of 32.5% from the previous year’s reported figure.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>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 Ralph Lauren Corporation (RL): Free Stock Analysis Report Hanesbrands Inc. (HBI): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis Report Kontoor Brands, Inc. 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