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On Tuesday, BMO Capital Markets adjusted its price target for PVH Corp (NYSE:PVH), the parent company of brands such as Tommy Hilfiger and Calvin Klein, reducing it from $106.00 to $93.00. Despite this change, the firm maintained a Market Perform rating on the stock. According to InvestingPro data, PVH currently trades at an attractive P/E ratio of 5.23x, suggesting potential undervaluation relative to its peers.
PVH Corp recently reported earnings per share (EPS) that surpassed expectations, bolstered by stronger-than-anticipated sales and effective management of selling, general, and administrative expenses (SG&A). However, the company’s gross margins contracted by approximately 200 basis points, a reflection of increased promotional activity, a less favorable mix of sales channels, and higher freight costs. This contraction placed PVH’s fourth-quarter performance near the lower end compared to its industry peers, excluding one outlier.
Looking ahead, PVH management has provided guidance for the first quarter that exceeds analyst expectations, a move that is not commonly seen. Furthermore, the company has introduced its full-year EPS forecast, which is significantly higher than the Street’s predictions. For deeper insights into PVH’s valuation and 14+ additional ProTips, including detailed margin analysis and growth metrics, check out the comprehensive research available on InvestingPro. Investors and analysts are keen to gain more insights from the upcoming conference call scheduled for tomorrow at 9 AM ET. During this call, PVH is expected to discuss quarter-to-date trends, details within the provided guidance, including gross margin expectations, and the trajectory of its international business.
The new price target of $93.00 is based on approximately 7 times the projected EPS for the fiscal year 2026. This valuation reflects the mixed financial results and forward-looking guidance provided by PVH Corp. According to InvestingPro’s Fair Value analysis, PVH currently appears undervalued, suggesting potential upside for investors. Investors will be looking to the conference call for further clarification and details that may impact the company’s stock performance.
In other recent news, PVH Corp. announced its fourth-quarter results, which exceeded analysts’ expectations, leading to a significant 12% surge in after-hours trading. The company reported adjusted earnings per share of $3.27, surpassing the anticipated $3.24, and generated revenue of $2.37 billion, slightly higher than the expected $2.34 billion. Despite a 5% year-over-year decline in revenue, PVH’s North American Tommy Hilfiger and Calvin Klein revenue rose by 1%. Looking ahead, PVH projects earnings per share between $12.40 and $12.75 for fiscal 2025, exceeding the consensus estimate of $11.68, with revenue expected to remain flat or slightly increase compared to 2024.
Additionally, Evercore ISI recently adjusted its price target for PVH to $105 from $139 while maintaining an Outperform rating. This change follows the company’s strategic moves, such as implementing a $500 million Accelerated Share Repurchase program, anticipated to add approximately $1.50 to its EPS in 2025. PVH’s Fall 2025 Europe backlogs showed a 3% year-over-year increase, although the company faces challenges like a decline in China revenues and a slowdown in U.S. traffic. Despite these headwinds, PVH’s financial maneuvers reflect resilience amid a complex business environment.
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