Those in search of threads, yarns and trims might visit a local haberdashery. The idea feels quaint in 2022, where sewing has largely been replaced by shopping. There is nothing quaint about thread manufacturing, however. The lucrative industry literally holds together swathes of the retail sector, and promises to be a reliable source of returns for investors.
IC TIP:
Buy
Tip style
Growth
Risk rating
Medium
Timescale
Medium Term
Bull points
- Convincing growth opportunities
- Large market share
- $50mn cost-saving drive
- More demand for sustainable thread
Bear points
- Tight US labour market
- Inflationary pressures
Uxbridge-headquartered Coats (COA) might not be a household name, but it is the world’s leading manufacturer of threads, yarns, zips and trims. In the world of apparel and footwear, it has a 23 per cent market share, and is estimated to be over twice the size of its nearest thread competitor.