PVH Corp. (NYSE:PVH), the company that owns and operates the brands Tommy Hilfiger and Calvin Klein, reported better-than-expected financial results for the fourth quarter, sending its shares soaring.
Shares of PVH surged 17.3% to about $76 at midday on Tuesday.
For Q4, PVH's revenue declined 5% year-over-year to $2.37 billion, ahead of estimates of $2.34 billion.
Earnings per share of $3.27 beat the consensus of $3.20.
For 2025, the company projected revenue to be flat to increase slightly compared to 2024 and earnings per share in the range of $12.40 to $12.75, ahead of forecasts of $11.68.
UBS analysts reiterated their ‘Buy’ rating on PVH following its quarterly report, citing the company’s growth potential and attractive valuation. They awarded the company a $160 price target.
“We believe PVH has the brand strength and balance sheet to drive earnings growth over the long-term,” they wrote.
“We believe the company is on a path to returning to positive mid-single digit percentage annual revenue growth at a mid-teens margin.”
They noted three signs the company continues to make progress, firstly Calvin Klein’s Europe Fall 2025 order books are back to growth.
“We believe this shows PVH’s effort to improve its product assortment, marketing, and speed-to-market, while exiting brand-dilutive distribution is working,” the analysts explained.
They also noted key efficiencies in the company’s SG&A structure.
“The company has discussed a variety of opportunities to get more efficient within SG&A and these are playing out, in our view, and will continue to do so in financial year 2025,” analysts wrote.
Further, PVH repurchased $500 million in stock in 2024, with plans to purchase an additional $500 million in 2025.
“Our view is PVH’s self-help initiatives are creating meaningful shareholder value. At the same time, downside risks related to tariffs, geopolitics and other factors PVH can’t control could weigh on the stock,” UBS wrote.
“Nevertheless, we think the stock is worth owning despite these risks. The main reason is we believe most of the risks are priced into the stock.”