Citi on PVH Corp (PVH) Earnings: '4Q Fine, but Weak F24 Guidance; Europe More Challenging'
Citi analyst Paul Lejuez reiterated a Neutral rating and $139.00 price target on PVH Corp (NYSE: PVH)
The analyst comments "4Q results were better than guidance and consensus, beating on both the top and bottom line. The issue is that guidance for F24 ($10.75-11.00) is significantly lower than consensus ($12.11) and mkt expectations. Mgmt guided sales down 6-7% for the year (well below consensus of -1%) and down 11% for 1Q (well below consensus of -3.7%), implying that results have weakended significantly in 1Q. The press release implies a further weakening in Europe, where the company had started to see some softness in 3Q, but we await the call for more detail. Operating margin is expected to be flat in F24, which may not sound too bad in the context of sales down 6-7%, but expectations were for margin expansion. Investors had become much more optimistic about the stock after last earnings call when mgmt said that EBIT margin could expand even in a weak sales environment."
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Shares of PVH Corp closed at $139.73 yesterday.