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Fossil Group
(NASDAQ:FOSL)
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Rating:57Neutral
Price Target:
$7.50
▲(39.41% Upside)
Action:Reiterated
Date:10/07/26
Overall score reflects a turnaround-in-progress with meaningful risks: financial performance is still pressured by declining revenue, ongoing losses, higher leverage, and negative TTM free cash flow, which keeps the score below average. Offsetting this, technicals are strong with clear upward trend and positive momentum, and the latest earnings call improved sentiment via raised margin/FCF guidance and strong gross-margin progress. Valuation remains constrained by losses (negative P/E) and no dividend support.
Positive Factors
Gross Margin Expansion
The sharp gross-margin improvement indicates better full-price selling, cost discipline, and operational execution. If sustained, stronger merchandise economics can support improved operating leverage, reduce dependence on volume growth, and provide a more durable foundation for the turnaround.
Negative Factors
Persistent Revenue Contraction
Ongoing sales contraction remains a fundamental challenge because margin improvements may be harder to sustain without a recovering revenue base. Store closures and operating-model changes may improve efficiency, but they also reduce near-term scale and leave the turnaround dependent on renewed demand.
Read all positive and negative factors
Positive Factors
Negative Factors
Gross Margin Expansion
The sharp gross-margin improvement indicates better full-price selling, cost discipline, and operational execution. If sustained, stronger merchandise economics can support improved operating leverage, reduce dependence on volume growth, and provide a more durable foundation for the turnaround.
Read all positive factors
Fossil Group (FOSL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$422.84M
Dividend YieldN/A
Average Volume (3M)789.94K
Price to Earnings (P/E)―
Beta (1Y)1.51
Revenue Growth-9.10%
EPS Growth-15.30%
CountryUS
Employees4,500
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Footwear & Accessories
Share Statistics
EPS (TTM)-1.28
Shares Outstanding59,138,054
10 Day Avg. Volume901,557
30 Day Avg. Volume789,938
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)2.01
Price to Sales (P/S)0.21
P/FCF Ratio-3.42
Enterprise Value/Market Cap1.19
Enterprise Value/Revenue0.51
Enterprise Value/Gross Profit0.90
Enterprise Value/Ebitda-267.71
Forecast
1Y Price Target
$9.25Price Target Upside71.93% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)-0.04
Revenue Forecast (FY)$965.86M
Fossil Group Business Overview & Revenue Model
Company Description
Fossil Group, Inc., along with its subsidiaries, specializes in the global design, development, marketing, and distribution of consumer fashion accessories. Its extensive product range encompasses classic timepieces, cutting-edge smartwatches, var...
How the Company Makes Money
Fossil Group makes money by selling branded fashion accessories through a mix of wholesale and direct-to-consumer (DTC) channels. (1) Wholesale revenue: Fossil sells products (primarily watches and jewelry, and in some cases other accessories) to ...
Fossil Group Earnings Call Summary
Earnings Call Date:Aug 12, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call emphasized strong operational progress: materially expanded gross margins (+490 bps), doubled adjusted operating income, raised full-year guidance, and improved regional/product momentum (U.S., India, traditional watches). These positive developments were balanced against continuing top-line pressure (Q2 sales down 4%) driven largely by store portfolio actions, EMEA geopolitical headwinds, and a modest royalty-related margin offset (~1.5 pts). Management projects a return to revenue growth in Q4 and positive free cash flow for 2026, reflecting confidence in the turnaround. Overall, achievements and improving profitability signals meaningfully outweigh the near-term revenue and regional challenges.Positive Updates
Gross Margin Expansion
Q2 gross margin of 62.4%, up ~490 basis points year-over-year, driven by a full-price selling model, supply chain benefits and lower tariffs. Management now expects full-year gross margins to be in the upper 50s (assuming no additional tariff refunds).
Negative Updates
Revenue Decline and Store-Related Drag
Q2 net sales of $211 million represented a 4% YoY decline. Management cites ~220 basis points of the decline related to its store closure program. Full-year sales still expected to decline ~3%–5%, with roughly 360 basis points of that decline attributable to store closures and an extra week in 2025.
Read all updates
Q2-2026 Updates
Positive
Negative
Gross Margin Expansion
Q2 gross margin of 62.4%, up ~490 basis points year-over-year, driven by a full-price selling model, supply chain benefits and lower tariffs. Management now expects full-year gross margins to be in the upper 50s (assuming no additional tariff refunds).
Read all positive updates
Company Guidance
Fossil raised its full‑year 2026 outlook: worldwide net sales are now expected to decline 3%–5% (vs. prior -4%–6%), with roughly 360 basis points of that decline attributed to net store closures and the extra week in 2025, and management still expects a return to consolidated revenue growth in Q4; full‑year gross margins are now anticipated in the upper‑50% range (Q2 gross margin was 62.4%, up 490 bps YoY) and adjusted operating margin is guided to 4%–6% (vs. prior 3%–5%) after Q2 adjusted operating income roughly doubled to about $9M on $211M of net sales (Q2 sales down 4% YoY, including ~220 bps impact from store closures). The company also now expects to generate positive free cash flow for 2026 and finished Q2 with $79M cash, $18M availability under its ABL, $178M of inventory, and an expected ~178 global store locations at year‑end.Fossil Group Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
22
Negative
Cash Flow
28
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 985.16M | 1.00B | 1.14B | 1.41B | 1.68B | 1.87B |
| Gross Profit | 558.93M | 563.15M | 597.15M | 685.12M | 830.68M | 966.37M |
| EBITDA | -1.88M | -16.47M | -83.07M | -72.95M | 20.44M | 107.74M |
| Net Income | -69.88M | -78.30M | -102.67M | -157.09M | -44.16M | 25.43M |
Balance Sheet | ||||||
| Total Assets | 653.14M | 689.30M | 763.57M | 978.03M | 1.24B | 1.37B |
| Cash, Cash Equivalents and Short-Term Investments | 78.95M | 95.80M | 123.60M | 117.77M | 198.73M | 250.84M |
| Total Debt | 341.94M | 282.20M | 315.83M | 388.67M | 416.36M | 375.15M |
| Total Liabilities | 579.15M | 602.50M | 626.84M | 726.29M | 835.12M | 903.36M |
| Stockholders Equity | 89.89M | 102.83M | 148.70M | 254.23M | 405.93M | 463.23M |
Cash Flow | ||||||
| Free Cash Flow | -41.21M | -60.46M | 39.93M | -69.35M | -124.12M | 39.74M |
| Operating Cash Flow | -37.92M | -57.90M | 46.68M | -59.46M | -110.86M | 50.03M |
| Investing Cash Flow | 3.10M | 22.08M | 4.04M | -9.87M | -8.55M | 7.11M |
| Financing Cash Flow | -973.00K | -5.01M | -50.21M | -13.63M | 52.99M | -112.57M |
Fossil Group Technical Analysis
Positive
5.38
Price Trends
5.75
Positive
4.97
Positive
4.62
Positive
Market Momentum
0.49
Negative
68.63
Neutral
82.55
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FOSL, the sentiment is Positive. The current price of 5.38 is below the 20-day moving average (MA) of 6.35, below the 50-day MA of 5.75, and above the 200-day MA of 4.62, indicating a bullish trend. The MACD of 0.49 indicates Negative momentum. The RSI at 68.63 is Neutral, neither overbought nor oversold. The STOCH value of 82.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FOSL.
Fossil Group Risk Analysis
Fossil Group disclosed 58 risk factors in its most recent earnings report. Fossil Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fossil Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $503.75M | 17.35 | 8.19% | 4.75% | 4.83% | 136.40% | |
65 Neutral | $310.00M | 13.88 | 31.49% | 176.87% | 47.74% | 162.62% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $422.84M | -5.57 | -69.12% | ― | -9.10% | -15.30% | |
52 Neutral | $160.92M | -5.42 | -37.58% | 15.82% | 6.41% | -893.45% | |
46 Neutral | $118.06M | -0.41 | 188.88% | ― | -23.34% | -12.90% |
* Consumer Cyclical Sector Average
FOSL
Fossil Group
7.15
4.44
163.84%
MOV
Movado Group
32.06
15.08
88.75%
ELA
Envela
11.96
4.17
53.53%
LANV
Lanvin Group Holdings
0.92
-0.91
-49.73%
BRLT
Brilliant Earth Group
1.53
-1.14
-42.70%
Fossil Group Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Fossil Shareholders Approve Incentive Plan and Board Slate
Positive
Oct 6, 2026
At its 2026 Annual Meeting of Stockholders held on October 2, 2026, Fossil Group, Inc. shareholders approved the First Amendment to the company’s 2024 Long-Term Incentive Plan, aligning executive and employee incentives with the firm’s...
Regulatory Filings and ComplianceShareholder Meetings
Fossil Group Schedules 2026 Annual Shareholder Meeting
Neutral
Jul 20, 2026
On July 20, 2026, Fossil Group’s board set October 2, 2026 at 9:00 a.m. Central Time as the date and time for its 2026 annual meeting of stockholders. The board also established August 3, 2026 as the record date to determine which shareholde...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.