PVH Corp. (PVH): Guidance is Conservative - UBS

UBS analyst, Michael Binetti, believes PVH Corp. (NYSE: PVH) has one of the best organic growth stories in his coverage universe, and '16 guidance is conservative.

1) While PVH’s guidance doesn't assume US d-store trends will improve (several d-stores are guiding for SSS to accelerate in 2H), US dstores should finally be done clearing inventory by the end of F2Q—with open-to-buys down 5-10% YOY…which should minimize risk of unplanned markdowns in 2H.

2) Guidance already assumes CK N. America wholesale growth will slow to +HSD in 2H (vs +20% in 2Q) to calibrate for tougher compares.

3) We think the US tourist business (a major drag to US results for 2-yrs) poses much less downside from here. PVH will begin lapping weak US tourism trends in late summer; non-tourist stores are comping +LSD.

No change to Buy rating or price target of $115.

For an analyst ratings summary and ratings history on PVH Corp click here. For more ratings news on PVH Corp click here.

Shares of PVH Corp closed at $93.55 yesterday.

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