PVH stock price turns around with an extended Buyback

Founded in 1881, PVH Corp (PVH: US) has been one of the largest and most established fashion companies. The company is the umbrella over several brands and six divisions: Tommy Hilfiger NA, Tommy Hilfiger Inter., Calvin Klein NA, Calvin Klein Inter., Heritage Brands Wholesale, and Heritage Brands Retail

PVH commenced 2022 with a closing price of $108.03. Since then the price has seen a startling decrease. The stock closed at $77.04 on April 18, marking a decline of 28.69% in almost four months. While the stock is seeing a significant decline, one positive turnaround was PVH’s announcement of a buyback. This statement helped propel the stock price to a hopeful future.

BuyBack Announcement

A headline from April 13, 2022, revealed that PVH had just approved a $1 billion buyback program. The repurchase program approved by the company’s board of directors has also been extended to a period of three years, from June 03, 2023, to June 03, 2026. 

As a result, PVH’s price went upwards in a short period of time since the announcement. On April 11, 2022, the stock opened at $72.14. Two days later, it ended on April 13 at a closing value of $80.70. This gave away a price rise of 11.87% in just two days. 

Earning and News Announcements

On March 29, PVH unveiled its earnings report for Q4 and full-year 2021, which came with both good news and bad news. 

The company’s revenue for 2021 reported significant revenue increases from its Tommy Hilfiger and Calvin Klein businesses. The Tommy Hilfiger business’s earnings were up by 29% and Calvin Klein fetched 39% more profits compared to 2020. In contrast, however, Heritage Brands did not fare well and reported an 8% decrease in earnings.

For the future outlook, PVH’s earnings are predicted to rise by up to 3%. However, much of the company’s operation depends largely on how the whole world will fare on the aftermath of the Russia-Ukraine conflict and COVID-19.

PVH Corp’s plan for growth strategies in the upcoming years was also revealed at the same time as the buyback announcement. The plan is focused on its most profitable brands: Calvin Klein and Tommy Hilfiger. 

Even though the stock is already down to $77.04 as of April 18, one can hope for bullish news surrounding one of the longest-running fashion companies of its time. 

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