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PVH Corp (PVH) to Report Q3 Earnings: What's in the Offing?

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PVH Corporation (PVH - Free Report) is slated to release third-quarter fiscal 2020 results on Dec 3. In the last reported quarter, the company delivered an earnings surprise of 105.3%. Moreover, its bottom line surpassed estimates by 11.4%, on average, over the trailing four quarters.

The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings is pegged at 21 cents per share, indicating a year-over-year decline of 93.2%. The consensus estimate for earnings has moved north by a penny in the past seven days. The consensus mark for quarterly revenues is pegged at $1.97 billion, implying a 24% decline from the year-ago reported number.

Key Factors to Note

PVH Corp has been witnessing impressive trends in the digital arena, which has been making up for lost sales during temporary store closures since the onset of the coronavirus pandemic. A shift in customers’ preference to online purchases has been aiding e-commerce sales. Notably, solid traffic and higher conversions have been contributing to digital growth. In second-quarter fiscal 2020, digital sales improved more than 50% year over year. Moreover, management stated that the momentum in the digital business has sustained in the initial weeks of the fiscal third quarter. Consequently, we expect the positive digital trends to have slightly aided the company’s top line in the to-be-reported quarter.

PVH Corp. Price and EPS Surprise

 

PVH Corp. Price and EPS Surprise

PVH Corp. price-eps-surprise | PVH Corp. Quote

Moreover, PVH Corp has been benefiting from strength in Calvin Klein and Tommy Hilfiger brands. Notably, the majority of the company’s stores have reopened, which is likely to have contributed positively to its top-line performance in the third quarter.

However, reduced store hours and lower occupancy levels have somewhat affected initial growth in sales volume in the fiscal third quarter. Moreover, a significant decline in shipment has been weighing on the company’s wholesale revenues. In the last reported quarter’s earnings call, it predicted the top and bottom lines in the second half of fiscal 2020 to be hurt by COVID-19 impacts, with a year-over-year revenue decline of 25%.

Zacks Model

Our proven model predicts an earnings beat for PVH Corp this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

PVH Corp has an Earnings ESP of +162.72% and a Zacks Rank #3.

Stocks to Consider

Here are some other companies that you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat:

Signet Jewelers Limited (SIG - Free Report) currently has an Earnings ESP of +13.95% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

lululemon athletica inc. (LULU - Free Report) presently has an Earnings ESP of +0.47% and a Zacks Rank #3.

Carnival Corporation (CCL - Free Report) currently has an Earnings ESP of +12.14% and a Zacks Rank #3.

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