By Senad Karaahmetovic
UBS analysts reiterated a Buy rating and a $100 per share price target on PVH (NYSE:PVH) shares as he believes the story is underappreciated.
PVH, the New York-based clothing company which owns brands such as Tommy Hilfiger, Calvin Klein, Warner's, and Olga, is also a Top Pick for 2023 at UBS. The analysts highlight two key reasons why they are increasingly convinced of PVH's outperformance.
"1) Among the 40 stocks we cover, we believe PVH is one of the most likely to deliver better-than-expected earnings next year. The market, in our view, is too focused on macro/FX and is missing PVH's ability to drive relative earnings outperformance vs. peers using its "PVH+ Plan" self-help initiatives. 2) Very attractive valuation at ~8x FY2 EPS, a multiple that is 40% below our Softlines coverage universe average FY2 P/E," they said in a client note.
The analysts believe PVH has a strong strategic plan, the ability to execute this plan, as well as a reasonable time frame.
"One of investors' core questions is if PVH has the right plan to transform Tommy Hilfiger and Calvin Klein into premium, direct-to-consumer, global, lifestyle brands and transcend the wholesale channel. Our view is, yes," they added.
PVH stock closed at $72.81 yesterday.