Kate Spade shares plunge 24 per cent after margin warning
Published on Aug 13, 2014 2:00 AM
NEW YORK (REUTERS) - Kate Spade & Co's shares lost nearly a quarter of their value after the handbag and accessory retailer said gross margins were being hit by intense competition, particularly in the Kate Spade Saturday brand.
Kate Spade Saturday sells apparel, handbags and jewellery at almost half the price of the company's upmarket kate spade new york brand.
Profit margins are also thinner for the Kate Spade Saturday brand, which caters to younger shoppers.
The stock, which reversed course after touching a seven-year-high on strong quarterly results, was the biggest loser and one of the most traded on the New York Stock Exchange on Tuesday. The selloff also marked the stock's biggest intraday percentage loss in four years.
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