PVH shares rise on better-than-expected 1Q results

PVH shares get a boost from better-than-expected fiscal 1st-qtr results, optimism about FY

Associated Press

NEW YORK (AP) -- Shares of PVH Corp., the parent of Tommy Hilfiger and other clothing brands, rose Thursday after the company posted a smaller quarterly loss than Wall Street expected.

THE SPARK: PVH said it lost $20.1 million, or 25 cents per share, over the three months ended May 5. Excluding one-time charges the former Phillips-Van Heusen said it earned $1.91 per share. Its revenue rose 34 percent to $1.91 billion.

Analysts polled by FactSet expected adjusted net income of $1.35 per share and $1.88 billion in revenue.

THE BIG PICTURE: The New York-based company got a boost from its February $2.9 billion acquisition of competitor Warnaco Group, which gave strengthened its control of the Calvin Klein brand.

Revenue from Calvin Klein more than doubled in the first quarter.

PVH backed its previous full-year outlook of an adjusted profit of $7 per share on about $8.2 billion in revenue. It expects adjusted net income of $1.35 per share and $1.9 billion in revenue in the second quarter.

Analysts are now projecting income of $7.05 per share and $8.18 billion in revenue for the fiscal year, including $1.36 per share and $1.85 billion in the fiscal second quarter.

THE ANALYSIS: Cowen & Co. analyst John Kernan, who backed his "Ouperform" rating for the stock and established a $135 price target, said the company should get a boost from the further integration of its new Calvin Klein lines and the continued strength of the Tommy Hilfiger brand.

Kernan said the company's unchanged fiscal-year outlook "appears conservative," saying that improved profitability at Tommy Hilfiger could result in better-than-expected earnings for the rest of 2013.

THE SHARES: Up $10.62, or 9.5 percent, to $121.90 in heavy morning trading, after peaking at $123.13 earlier in the session, a few dollars short of its 52-week high of $125.50.

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