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Why has PVH Corp Stock Gained Over 11% Since Q4 Results?
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PVH Corp. (PVH - Free Report) has exhibited an impressive performance in the last one year, with its stock up 4% even when the Textile – Apparel Manufacturing industry was down 23.5%. Well, the apparel industry has been facing a tough time due to the lingering currency headwinds, sluggish mall traffic and other macroeconomic hurdles. PVH’s solid momentum despite these hurdles speaks volumes about its ongoing growth efforts, alongside highlighting its splendid prospects.
This became clearer when the company posted better-than-expected results for fourth-quarter fiscal 2016 even in the face of a challenging retail landscape. The strong performance has also caused this Zacks Rank #3 (Hold) stock to gain 11.7%, with the earnings estimates for the first-quarter and fiscal 2017 witnessing an uptrend, since the quarterly outcome.
Notably, sales marked its second consecutive beat and earnings kept its positive surprise streak alive for the 11th straight time in the fiscal fourth quarter. Following the results, stock has surged 11.7%. Results continued to gain from solid momentum at the company’s premium Calvin Klein and Tommy Hilfiger brands, particularly in the international regions – with Europe and China being the highlights.
Further, the company’s robust fiscal 2016 show impressed management. Management believes that the company’s superb execution, continued investments in brands and international platforms kept it going. Also, keeping pace with the evolving trends and undertaking necessary initiatives to stay afloat in the current business scenario helped PVH sustain its momentum.
Evidently, PVH’s recent deal to acquire True&Co (direct-to-consumer intimate apparel online retailer), underscores its focus on making innovations and developing its omnichannel operations to enrich consumer experience. Further, the company’s latest agreement with Li & Fung is likely to enhance its supply-chain network.
We believe that all these factors encouraged the company to issue a favorable fiscal 2017 outlook, which in turn caused an uptrend in estimates. Clearly, PVH is well positioned to maintain its upbeat performance in future.
However, PVH continues to face the perils of foreign currency headwinds, as was evident from the fiscal fourth quarter. Also, management expects adverse currency to persist and hurt results in fiscal 2017. PVH Corp. expects currency fluctuations to adversely impact fiscal 2017 and first quarter earnings by 40 cents and 10 cents per share, respectively. Alongside, the company expects volatility in the overall retail environment, sluggish store traffic and unpredictable global consumer spending to remain major challenges.
Nonetheless, we believe that PVH’s efforts to integrate consumers’ changing preferences into its operating decisions and transform accordingly, is taking it in the right direction. These strategies, along with its diversified brand portfolio should help it to exploit opportunities in the lifestyle apparel market.
Stocks to Consider
Better-ranked stocks in the apparel/shoe space include The Children's Place, Inc. (PLCE - Free Report) , Kate Spade & Company and Foot Locker, Inc. (FL - Free Report) . While Children's Place and Kate Spade sport a Zacks Rank #1 (Strong Buy) each, Foot Locker currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Children's Place has an average positive earnings surprise of 39% in the trailing four quarters. The stock has a long-term growth rate of 10.3%.
Kate Spade, with long-term earnings per share growth rate of 28.3%, has delivered positive earnings surprise in the last two quarters.
Foot Locker has delivered positive earnings surprise in the last three quarters. The stock has a long-term growth rate of 9.7%.
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Why has PVH Corp Stock Gained Over 11% Since Q4 Results?
PVH Corp. (PVH - Free Report) has exhibited an impressive performance in the last one year, with its stock up 4% even when the Textile – Apparel Manufacturing industry was down 23.5%. Well, the apparel industry has been facing a tough time due to the lingering currency headwinds, sluggish mall traffic and other macroeconomic hurdles. PVH’s solid momentum despite these hurdles speaks volumes about its ongoing growth efforts, alongside highlighting its splendid prospects.
This became clearer when the company posted better-than-expected results for fourth-quarter fiscal 2016 even in the face of a challenging retail landscape. The strong performance has also caused this Zacks Rank #3 (Hold) stock to gain 11.7%, with the earnings estimates for the first-quarter and fiscal 2017 witnessing an uptrend, since the quarterly outcome.
PVH Corp. Price and Consensus
PVH Corp. Price and Consensus | PVH Corp. Quote
Notably, sales marked its second consecutive beat and earnings kept its positive surprise streak alive for the 11th straight time in the fiscal fourth quarter. Following the results, stock has surged 11.7%. Results continued to gain from solid momentum at the company’s premium Calvin Klein and Tommy Hilfiger brands, particularly in the international regions – with Europe and China being the highlights.
Further, the company’s robust fiscal 2016 show impressed management. Management believes that the company’s superb execution, continued investments in brands and international platforms kept it going. Also, keeping pace with the evolving trends and undertaking necessary initiatives to stay afloat in the current business scenario helped PVH sustain its momentum.
Evidently, PVH’s recent deal to acquire True&Co (direct-to-consumer intimate apparel online retailer), underscores its focus on making innovations and developing its omnichannel operations to enrich consumer experience. Further, the company’s latest agreement with Li & Fung is likely to enhance its supply-chain network.
We believe that all these factors encouraged the company to issue a favorable fiscal 2017 outlook, which in turn caused an uptrend in estimates. Clearly, PVH is well positioned to maintain its upbeat performance in future.
However, PVH continues to face the perils of foreign currency headwinds, as was evident from the fiscal fourth quarter. Also, management expects adverse currency to persist and hurt results in fiscal 2017. PVH Corp. expects currency fluctuations to adversely impact fiscal 2017 and first quarter earnings by 40 cents and 10 cents per share, respectively. Alongside, the company expects volatility in the overall retail environment, sluggish store traffic and unpredictable global consumer spending to remain major challenges.
Nonetheless, we believe that PVH’s efforts to integrate consumers’ changing preferences into its operating decisions and transform accordingly, is taking it in the right direction. These strategies, along with its diversified brand portfolio should help it to exploit opportunities in the lifestyle apparel market.
Stocks to Consider
Better-ranked stocks in the apparel/shoe space include The Children's Place, Inc. (PLCE - Free Report) , Kate Spade & Company and Foot Locker, Inc. (FL - Free Report) . While Children's Place and Kate Spade sport a Zacks Rank #1 (Strong Buy) each, Foot Locker currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Children's Place has an average positive earnings surprise of 39% in the trailing four quarters. The stock has a long-term growth rate of 10.3%.
Kate Spade, with long-term earnings per share growth rate of 28.3%, has delivered positive earnings surprise in the last two quarters.
Foot Locker has delivered positive earnings surprise in the last three quarters. The stock has a long-term growth rate of 9.7%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emergingphenomenon and 6 tickers for taking advantage of it. If you don't buy now, you maykick yourself in 2020. Click here for the 6 trades >>