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PVH Corp on the Street: An Expectations Story

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Part 3
PVH Corp on the Street: An Expectations Story PART 3 OF 5

Can PVH Corp’s Earnings Shape up in 4Q16?

PVH Corp has outperformed consensus repeatedly

PVH Corp (PVH) has put up a good show recently, consistently outperforming Wall Street’s earnings estimates. The company has beaten the consensus estimate for the past ten consecutive quarters, and the better-than-expected performances of Calvin Klein and Tommy Hilfiger brands have been crucial to the company’s robust performance.

For 4Q16, the company’s management has forecast an adjusted EPS (earnings per share) in the range of $1.13–$1.18, as compared to $1.52 one year previously. Currency headwinds are projected to continue into the fourth quarter and to impact earnings by $0.23 per share.

Can PVH Corp&#8217;s Earnings Shape up in 4Q16?

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For fiscal 2016, the company’s EPS guidance is $6.70–$6.75, as compared to $7.05 in fiscal 4Q15. This includes the impact of -$1.65 per share from currency adjustments during the year.

Recent earnings guidance

At the beginning of the year, PVH Corp’s management revised its guidance. The company now expects its EPS to be at the top end of its guidance range for 4Q16 and fiscal 2016.

The Wall Street estimate is in line with the management’s estimate. Analysts have forecasted a 21.8% fall in the company’s 4Q16 EPS to $1.19. For fiscal 2016, EPS is expected to fall 4.2% YoY to $6.76.

Notably, ETF investors looking to add exposure to PVH might consider the First Trust Large Cap Value AlphaDEX Fund (FTA), which invests 0.9% of its portfolio in PVH.

A look at recent performances of peers

Other apparel companies have delivered mixed performances. The EPS of VF Corporation (VFC) rose 2.1% YoY to $0.97 during the fourth quarter, which was in line with the consensus.

Ralph Lauren (RL), on the other hand, posted an EPS fall of 18% YoY to $1.86 during its third quarter results. The company, however, beat the Wall Street estimate by $0.22.

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