Vf Corporation (Vfc)
St. James Investment Company Updated: 15-December-16 V.F. C ORP ORATION (VFC) COMPANY DESCRIPTION VF Corp. operates as an apparel company which engages in the manufacture of fashion clothes, footwear, and other related products. VF’s brands include Jansport, Kipling, Lee, Lucy, Majestic, Nautica, Reef, The North Face, Timberland, Vans, Wrangler, Lee, Rock & Republic, Bulwark, Horace Small, Red Kap, and Wrangler Workwear. The company was founded in 1899 and is headquartered in Greensboro, North Carolina. INVESTMENT THESIS VF has established a broad and growing array of leading lifestyle brands, selected to enhance its presence in high-growth categories and for synergies within existing operating units. We think the company can take advantage of three market trends: 1) The outdoor and action sports market is a large and quickly growing opportunity, with active wear apparel now often worn in place of casual attire--represents a $46 billion opportunity with a focus on higher-margin performance and comfort products. The North Face line is already a leader in the $25 billion global outdoor market and provides high-performance sports apparel, an increasingly popular category thanks to the fitness craze. Management expects this category to be a key growth driver for VF and that further acquisitions will be made to increase exposure. Management states that it could grow organically to over 65% of revenue from the current 60% penetration over the next five years. 2) VF leverages its large global supply chain to support additional international sales. Management believes that international markets can grow from 30% of revenue to 45% of sales in five years.
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