Wells Fargo analyst Ike Boruchow remains "very bullish" on Tapestry (TPR) and raised estimates ahead of Q3 results. On the flip side, the analyst sees a tougher setup at Carter's (CRI) and is lowering estimates as the combination of unfavorable weather in March as well as multiple wholesale partner bankruptcies announced since the company last reported likely forces management to take a more conservative view on the business. Boruchow reiterates an Outperform rating on both stocks and a $60 price target on Tapestry. However, the analyst lowered his price target on Carter's to $126 from $145.

Capri Holdings (CPRI) shares could fall to the low-to-mid $20s if Tapestry's (TPR) $57 per share takeover is successfully blocked by the Federal Trade Commission, Yiqin Shen of Bloomberg reports, citing a survey of 20 merger-arbitrage specialists. The survey, conducted on Tuesday, focuses on merger-arbitrage estimates on the Capri's downside price - a level that reflects the stock's fundamental value by the end of 2024, when the outcome of the FTC's challenge is expected to be either upheld or overturned in court, Shen notes. Shares of Capri Holdings are down 5% to $34.81 in midday trading.