Double-digit increase in earnings expected
PVH Corporation (PVH), the owner of Calvin Klein and Tommy Hilfiger, is slated to report its 2Q17 results on August 22. The fashion giant has been a consistent performer, outdoing Wall Street’s earnings expectations for the past 12 quarters.
In 1Q17, PVH reported a 10% YoY (year-over-year) increase in its EPS (earnings per share), driven mainly by a business beat. Encouraged by its solid first quarter results, the company also raised its earnings outlook for 2Q17 as well as for fiscal 2017. It now expects to see EPS of $7.40–$7.50 for fiscal 2017 and $1.60–$1.63 for 2Q17.
By comparison, Wall Street analysts on average expect to see EPS of $1.64, which would be an 11.6% increase over the same quarter last year. For fiscal 2017, earnings are projected to increase 10.7% YoY to $7.53 per share.
Comparing earnings potential with peers
PVH is among the better-placed apparel companies. Its EPS are expected to rise ~12% over the next 12 months. This compares to the expected declines of 8.2% and 9.9% in the earnings of Ralph Lauren (RL) and Michael Kors (KORS), respectively.
VF Corporation (VFC) and Hanesbrands (HBI) are also likely to report growth in earnings, with next-12-month EPS jumps of 4.7% and 6.9%, respectively. Coach (COH) is projected to report a 12.1% rise in EPS, thanks to ongoing strategic initiatives like changes in sales and channel mix and reductions in promotional days.
ETF investors seeking to add exposure to PVH can consider the iShares Morningstar Mid-Cap Value ETF (JKI), which invests 0.63% of its portfolio in the stock.
Continue to the next and final part for a look at PVH’s year-to-date stock market performance and the analyst recommendations.