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On Thursday, BMO Capital analysts adjusted their outlook for PVH Corp (NYSE: NYSE:PVH) by lowering the stock’s price target to $84 from a previous $93, while maintaining a Market Perform rating. This decision followed PVH Corp’s latest earnings report, which showed an earnings per share (EPS) beat due to stronger-than-expected sales and selling, general, and administrative expenses (SG&A).
The report highlighted that despite the EPS beat, gross margin (GM) contracted by approximately 285 basis points, compared to a guidance of a 250 basis point decline. While challenging, the company maintains impressive gross profit margins of 59.43% according to InvestingPro data. This contraction was attributed to increased promotions, an unfavorable channel mix partly resulting from a licensing transition, and higher freight costs. These factors positioned PVH’s first-quarter performance near the lower end of its group’s gross margin results.
Management provided guidance for the second quarter EPS, which was below expectations, a move described as typical by the analysts. Additionally, there was a significant reduction in the full-year EPS guidance. The analysts expressed interest in the upcoming conference call scheduled for Friday at 9 AM ET, where they expect to gain further insights into quarter-to-date trends and more details on the company’s guidance, including gross margin and international trajectory.
The revised price target of $84 represents approximately seven times the projected EPS for fiscal year 2026. The analysts’ comments reflect a cautious approach given the current challenges faced by PVH Corp.
In other recent news, PVH Corp has revised its earnings forecasts, lowering its second-quarter adjusted earnings per share (EPS) projection to between $1.85 and $2.00, down from the previous estimate of $2.08. The company also adjusted its full-year EPS forecast to a range of $10.75 to $11.00, a decrease from the earlier range of $12.40 to $12.75, due to challenging macroeconomic conditions. Meanwhile, analyst firms have shared their perspectives on PVH Corp’s future. TD Cowen raised its price target to $113, citing positive European trends and manageable tariff impacts, while Needham initiated coverage with a Buy rating and a $115 price target, highlighting underappreciated EPS drivers. Citi increased its price target to $94, maintaining a Neutral rating and expecting first-quarter EPS to slightly exceed guidance. UBS raised its price target to $150, maintaining a Buy rating, but noted potential EPS constraints due to global uncertainties and tariff issues. These developments reflect a mix of cautious optimism and strategic adjustments in response to the current economic landscape.
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