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Why Wall Street Is Still Positive on PVH Corp.

Sonya Bells - Author
By

Aug. 18 2020, Updated 6:26 a.m. ET

Wall Street’s views: PVH versus peers

PVH Corp. (PVH) is covered by 19 Wall Street analysts, who together rate the company 2.0 on a scale of 1 (strong buy) to 5 (strong sell). Its rating has come down over the last two months. It was rated 1.8 in June.

Despite the slight deterioration, the company is better rated than Hanesbrands (HBI) at 2.4, Tapestry (TPR) at 2.1, Michael Kors (KORS) at 2.6, and Ralph Lauren (RL) at 3.0.

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Most investment firms are positive on PVH

About 79% of the 19 analysts covering PVH recommend a “buy” for the stock. They include Deutsche Bank, Barclays, and Citigroup. The company has a higher percentage of “buy” recommendations than most of its peers. In comparison, VF Corporation, Hanesbrands, and Ralph Lauren have “buy” recommendations from 70%, 40%, and 20% of analysts, respectively.

About 16% of the 19 analysts covering PVH have recommended a “hold” for the stock. They include Nomura, UBS, and Instinet. Only one analyst has recommended a “sell.”

Goldman Sachs recently initiated coverage on PVH with a “sell” rating. The analyst cited fading tailwinds and a growing share of wholesale rather than retail as the key points behind the bearish stance.

Target price

PVH Corp. was trading at $152.55 on August 22, which is ~11% below its 52-week high. Wall Street expects PVH to reach $172.83 over the next 12 months, reflecting a 13% upside to its current price.

PVH has a better upside than VFC, KORS, and HBI, whose stocks are projected to rise 9%, 2%, and 10%, respectively.

ETF investors seeking to add exposure to PVH can consider the iShares Edge MSCI Multifactor Consumer Discretionary ETF (CNDF), which invests 2.2% of its portfolio in PVH.

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