PVH Earnings: Solid Holiday Results Overshadowed by Dim 2024 Outlook; Shares Undervalued

No-moat PVH’s fourth-quarter results beat our forecast, but its shares plummeted 22% on April 2 as the company issued a disappointing 2024 outlook. Specifically, the firm projects a 6%-7% sales decline for the year, below our forecast for a 1% drop, due to weakening consumer demand for apparel in Western Europe and a difficult North America wholesale channel. Further, this sales shortfall is expected to lead to an operating margin and EPS of 10.1% and $10.75-$11.00, respectively, shy of our 10.9% and $11.66 estimates.