PVH rebounds as Credit Suisse raises price target
PVH (PVH) rose 2.7% yesterday after Credit Suisse reaffirmed its “outperform” rating on the company and raised the price target to $185 from $178. This rise ended the five-day losing streak for the company and put it among the top S&P 500 Consumer Discretionary gainers on Tuesday.
What’s behind the target price revision?
Analyst Michael Binetti said that PVH is likely to steal market share from stumbling competitors like Nautica and Kenneth Cole. He projected a healthy 13% to 15% rise in the company’s EPS despite headwinds related to tariffs, volatility in currency, and rising cotton prices. Binetti believes that PVH might expand through licensing deals or large-scale mergers or acquisitions going forward.
The revised price target of $185 indicates an upside of 20% on Tuesday’s stock price of $153.83. The average price target from the 19 analysts covering PVH is $174, reflecting an upside of 13%. PVH is currently sitting at YTD (year-to-date) gains of 12% and has outperformed the S&P 500 Index, which has posted gains of 1.8% year-to-date, by a significant gap.
Wall Street recommendations
PVH is among the best-rated apparel stocks. The company is rated a 2.0 on a scale where one is a “strong buy” and five is a “strong sell.” In comparison, Ralph Lauren (RL), Michael Kors (KORS), and VF (VFC) are rated 3.0, 2.6, and 2.3, respectively.
79% of analysts who cover PVH recommend buying the stock, 16% suggest holding it, while 5% have a “sell” recommendation.