In the world of investments, companies thrive or fail based on how attractive their stock is to investors and institutions. This week, we learned that Two Sigma Advisers LP had reduced its holdings in PVH Corp (NYSE: PVH) by a significant 27.5%. The investment advisory firm reported owning only 323,652 shares of the textile maker after selling off 122,600 shares during the quarter. With a position valued at $22,847,000 now after the selloff, Two Sigma Advisors LP owned merely about 0.51% of PVH’s worth at the end of the most recent recording period.
Headquartered in New York City, PVH Corp is famous for designing and marketing of dress shirts, neckwear, sportswear, jeans wear, intimate apparel, swim products, handbags footwear and other related products. The company operates through Tommy Hilfiger segment (consisting of Tommy Hilfiger North America and Tommy Hilfiger International), Calvin Klein segment and Heritage Brands segment.
PVH opened at $81.24 on Tuesday registering an impressive market capitalization of $5.10 billion together with a reasonable P/E ratio of around 25 which suggests that it’s not overvalued as compared to others in its sector such as Michael Kors or Ralph Lauren both having higher P/E ratios than PVH currently enjoys.
However high returns come with high risks – a sentiment reinforced by PVH’s beta value which rests at an incredibly variable 2.11; this signifies instability in its stock price movements relative to the rest of the market. Additionally, as per recent financial reports – quick ratio was recorded at 0.68 while current ratio was recorded at 1.40 leading us to conclude that there exists liquidity risk in case any kind uncertainty surfaces which can be detrimental for shareholders.
PVH’s good growth numbers are depicted from its PEG ratio also known as the price/earnings-to-growth ratio. This is an analytical tool that helps investors identify companies whose stock prices may not reflect their future earnings growth rates. PVH’s PEG ratio of 0.52 highlights its exposure to earnings potential growth, compared to other peers in the industry such as Ralph Lauren with a PEG ratio of 1.27, Coach with 2 and Michael Kors with 7.
Furthermore, the fashion apparels company has a promising chart outlook as PVH Corp., maintained its upside momentum. On top of that, the stock-price has been moving above both the broader market (S&P 500) and sector measures for textiles-apparel-clothing-sharing stocks like Lululemon and Under Armour.
In conclusion, this we can infer that PVH’s investment thesis is heavily influenced by high volatility along with promising potential for earnings growth- a factor Two Sigma Advisors LP had taken into account before cutting down its position by nearly a quarter recently.The good news though is that the apparent bull run looks set to continue!
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PVH Corp.’s Impressive Performance and Growing Investor Interest in the Textile Industry
PVH Corp. continues to garner the attention of investors and equities analysts alike due to its impressive performance in the textile industry. The company, which designs and markets a wide variety of apparel and accessory products including swimwear, footwear, handbags, dress shirts, jeans wear, sportswear and neckwear, is reportedly making significant strides in growing its Tommy Hilfiger brand as well as boosting sales in Calvin Klein and Heritage Brands.
Recently released earnings results indicate that the fashion-forward company is thriving despite market turbulence and tough competition from other players in the textile industry. For Q1 2017, PVH reported earnings per share of $2.14—clearly surpassing estimated figures by $0.21.
Moreover, PVH’s Q1 revenues reached $2.16 billion compared to the consensus estimate for revenue of around $2.13 billion. Its net margin stood at 2.24%, while return on equity was 11.83%. These figures elevated investor optimism towards the stock further emphasising the strong investment case of PVH.
Against this backdrop gains saw savvy investors amass a significant stake in PVH shares with Raymond James & Associates accounting for an additional 20.3% share holding during Q1 alone amounting to some 19,681 shares worth approximately $1,508m.
Several other large investors followed suit with HighTower Advisors LLC raising their stake by 17%, Citigroup Inc increasing their holdings by 29.2% PNC Financial Services Group buying additional companies shares thereby raising their own Holdings by an extra 226 shares or 2%,lastly MetLife Investment Management LLC purchased up an additional 21%.
With such mixed reviews coming from equities analysts it garnered for a consensus rating of “Hold” on Bloomberg.com whilst maintaining its average price target of $90.72.The word on Wall Street regarding PVH suggests that it could be headed toward great heights based on the company’s current market position; investors certainly seem to agree, with 93.50% of the stock now owned by institutional investors and hedge funds.
All things considered, PVH represents a solid investment opportunity for those who are willing to take a calculated risk and want exposure to the fashion-forward apparel industry.