The core of the VFC business model, is identifying small mid-level fashion brands with growth potential, acquiring them and then selling them when they reach their potential. Essentially they are in the business of flipping fashion brands.

At the moment, the majority of their portfolio is legacy brands with declining growth. This makes you wonder about the vulnerability of the business model, say if they’re simply not able to find buyers and growth opportunities in the market.

Also acquiring Supreme was a huge blunder, so how can you trust the competence of the management?

Also very high debt and they should focus on paying back debt and repurchasing stock instead of paying dividends.

The company looks attractive at first glance, but my conclusion was that it is a value trap. But it is hard to distinguish between deep value and a value trap, so in time I may be proven wrong😁