Coach Investing Substantially In Its Own Stock (COH)

Coach, Inc. (NYSE: COH) has just authorized a new share buyback program for the repurchase of up to $1 billion of its outstanding common stock.  The plan is set to expire on June 26, 2010.  Coach has just completed its current $1 billion repurchase program, which was just put into place in November 2007. It repurchased a total of 31.8 million shares of its own common stock under that program at an average cost of $31.42 per share.  That amount does include a total of 5.7 million shares at an average cost of $28.45 since it announced its fourth quarter earnings last month.

Shares of common stock will be made from time to time, and are subjectto market conditions and at prevailing market prices via open marketpurchases. The repurchased shares will become authorized but unissuedshares, and may be issued in the future for general corporate and otherpurposes. As a reminder, up to doesn’t force the company to purchasethe full amount and doesn’t force it to even come close to buying backthe full amount if it chooses not to.  The company may terminate orlimit the stock repurchase program at any time.

With roughly a $9 Billion market cap, this company is retiring a largeamount of stock.  While it doesn’t count in this manner and TreasuryStock is non-voting, you could almost joke that Coach is now its ownlargest shareholder.

Shares last November were already down into the mid-$30’s after seeingprices in the low $50’s earlier in 2007.  Its stock closed down almost7% today at $26.40, and the 52-week trading range is $23.22 to $50.95. 

Jon C. Ogg
August 25, 2008