Capri upgraded to buy at CFRA as it’s trading below the $57 acquisition price being offered by Tapestry

CFRA upgraded Capri Holdings Ltd.’s stock
CPRI,
+0.56%
to buy from hold on Wednesday, and said it’s looking undervalued at its current price. The stock was last quoted at $49.28, below the $57 price offer from rival Tapestry Inc.
TPR,
+1.31%,
which is buying Capri in a deal expected to close in 2024. “We believe shares are now undervalued, trading well below the acquisition price and what we see as fair value,” analyst Zachary Warring wrote in a note to clients. Capri, parent to Michael Kors, Versace and Jimmy Choo, is being acquired by Tapestry, parent to Coach, Kate Space and Stuart Weitzman for about $8.5 billion. Warring lowered his price target for Capri to $55 from $65 and cut his fiscal 2024 and fiscal 2025 EPS estimates by $1, to $5.50 and $6.00 respectively. The stock has fallen 14% in the year to date, while the S&P 500
SPX,
+0.40%
has gained 19%.