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Shares of PVH Corporation are ready to fly. Investors, please fasten your seat belts

PVH Corporation (NYSE: PVH), formerly known as Phillips-Van Heusen Corporation, is one of the largest clothing companies in the world that owns such brands as Van Heusen, Tommy Hilfiger, Calvin Klein.

Today, the corporation’s market capitalization is about $ 9.4 billion.
The company operates in three segments, and its product lines include clothing, perfumes, glasses, shoes, jewelry, watches, bags, small leather goods, and even household goods, including furniture.

Since the beginning of December 2018, PVH securities have risen in price substantially and have brought investors a return of 13%, and this despite the fact that the company still remains significantly undervalued relative to its key competitors. Its diversified portfolio of brands and successful business development provide an additional reason for investing in PVH stocks in the long term.

Fundamental analysis

Now PVH continues to actively expand its business, largely due to the improvement of e-commerce, the launch of new services, as well as the start of sales of Izod brand products in the markets of Spain, Germany, Scandinavia and the Netherlands. In addition, the company recently announced that it is in talks with the American apparel manufacturer G-III Apparel Group regarding the sale of its North American division for the production of women’s jeans under the Calvin Klein brand. Thanks to this deal, the company expects to offset the slowdown in the growth rate of sales of these products in North America by more aggressively expanding sales in foreign markets.

Financial results

According to reports published last week, PVH’s net profit in the fourth fiscal quarter, which ended February 3, was $ 158.7 million, or $ 2.09 per share, compared with $ 108.5 million or $ 1.39 per share for the same period last year. Proceeds, meanwhile, fell slightly to $ 2.48 billion, but still surpassed analysts’ forecasts. It should be noted that following the results of the entire fiscal year 2018, the company’s net profit amounted to $ 9.65 per share, while revenues reached a record $ 9.66 billion.

Along with the encouraging financial results, the company PVH presented good forecasts for the current fiscal year. The adjusted earnings are expected to be on the order of $ 10.30-10.40 per share, while analysts are forecasting $ 10.31 per share, and revenue may increase by 4% y / y to $ 10.04 billion compared to analysts’ expected $ 9.88 billion

In addition, the company announced that its board of directors approved an expansion of the share buyback program, which will be completed in June 2023, by $ 750 million.

Technical analysis


From a technical point of view, on the monthly chart, the stock price is traded within the upward channel, and taking into account the position of slow stochastic lines, in the medium term, we should expect the stock price to move towards the upper boundary of the channel.

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