24/7 Wall St. » PVH

More Apparel Deals Coming? (PVH, WRC, VFC, RL, ARO, ANF, OXM, LULU, UA, COLM)

247wallst — Mon, 15 Mar 2010 18:16:59 +0000

Phillips-Van Heusen Corp. (NYSE: PVH) has traders and investors speculating about or pondering which other apparel companies may become acquisition targets or which could end up in ‘mergers of equals’ as companies aim to strengthen their market positions. The PVH bid to acquire Tommy Hilfiger from Apax Partners for about $3 billion is technically a leveraged deal because the market cap for PVH was around $2.3 billion before it was announced. But now PVH shares are up almost 9% around $52.00 and we saw a 52-week high this morning of $54.64.

This deal may have put others in the spotlight. Warnaco Group Inc. (NYSE: WRC), V.F. Corporation (NYSE: VFC), Polo Ralph Lauren Corporation (NYSE: RL), Aeropostale, Inc. (NYSE: ARO), Abercrombie & Fitch Co. (NYSE: ANF), Oxford Industries Inc. (NASDAQ: OXM), Lululemon Athletica Inc. (NASDAQ: LULU), Under Armour, Inc. (NYSE: UA), Columbia Sportswear Company (NASDAQ: COLM) and many more are companies are now worth a second look in the sector. Most of these are more likely acquirers rather than targets, although not in all cases.

We wanted to take a sector review here on each as far as market capitalization rates, brands, and other issues which could or would come into play if more consolidation heads the way of clothing and accessories.

Warnaco Group Inc. (NYSE: WRC), with a $2.1 billion market cap, was in the M&A spotlight back during wave we saw from 2005 to 2007 when companies could get easy access to deal financing. The problem is that they are deemed a consolidator rather than a consolidation victim. In short, a buyer rather than a seller if the company has its own choice. It has brands such as Calvin Klein, Speedo, and Chaps.

V.F. Corporation (NYSE: VFC) is a monster in the sector, and one which likes owning brands. With a strong stock and a market cap close to $8.75 billion, VF can have the pick of the brands it wants to own. It has acquired The North Face, Vans, and others.

Filed under: Apparel, Mergers and Buy Outs, Private Equity, Retail, Rumors Tagged: ANF, ARO, COLM, LULU, OXM, PVH, RL, UA, VFC, WRC

Top Pre-Market analyst Downgrades (CEO, EXC, LLTC, NRG, PVH, POWI, TXN, WFMI)

247wallst — Tue, 21 Oct 2008 07:01:02 +0000

These are some of the top pre-market analyst downgrades and negative calls we are seeing from Wall Street this Tuesday morning:

CNOOC (CEO) Cut to Hold at Deutsche bank.
Excelon (EXC) Cut to Hold at Jefferies.
Linear Tech (LLTC) Cut to Market Perform at Raymond James.
NRG Energy (NRG) Cut to Hold at Jefferies.
Phillips-Van Heusen (PVH) Cut to Neutral at JPMorgan.
Power Integrations (POWI) Cut to Market Perform at Raymond James.
Texas Instruments (TXN) Cut to Market Perform at Raymond James.
Whole Foods (WFMI) Cut to Underperform at Jefferies.

Jon C. Ogg
October 21, 2008

Posted in Analyst Calls Tagged: CEO, EXC, LLTC, NRG, POWI, PVH, TXN, WFMI

Pre-Market Stock Movers (January 15, 2008) (EDU, COIN, CWTR, DNDN, DNA, WSM, FRX, LCBM, NWY, STT, PVH, TMA)

247wallst — Tue, 15 Jan 2008 08:50:55 +0000

Below is a snapshot of the key pre-market news that we are focusing on for early pre-market trading this Tuesday:

Apple (AAPL) has its Macworld today.
CECO Environmental (CECE) announced 14 new orders received totaling ~ $7.3 million.
Charles & Colvard (CTHR) lowered guidance and announced a strategic review.
Citigroup (C) was trading up but then went negative in early trading: -$1.99 EPS vs -$1.00 estimate, huge charges of $18.1 Billion, 4,200 layoffs included, review divestitures, cut $0.54 dividend down to $0.32.
Coldwater Creek (CWTR) lowered guidance, again, again. Shares down 15% to new low.
Converted Organics (COIN) announced its has secured a Rhode Island site for second organic fertilizer facility; stock down 6% pre-market.
Dendreon (DNDN) received a European patent covering Provenge and its ACI platform technology; shares up 5% pre-market after solid gains yesterday.
First American Financial (FAF) sees revenues of $1.9 Billion as expected but sees charges and writedowns.
Forest Labs (FRX) $0.96 EPS vs $0.75 estimate; Revenues $998.2 million versus $946+ million estimate. Raised 2008 guidance.
Genentech (DNA) trading down 2% pre-market after beating earnings but missing estimates on its top 4 drugs; sees 2008 EPS $3.30-3.45 vs. $3.37 estimate.
Kellwood (KWD) $21.00 tender from Sun Capital affiliate Cardinal Integrated commences.
Kosan (KOSN) initiated Phase II trials of alvespimycin, their second-generation inhibitor in patients with HER2-positive metastatic breast cancer.
Lifecore Biomedical (LCBM) trading up 29% after it agreed to be acquired by Warburg Pincus for $17.00 per share in cash.
Merrill Lynch (MER) confirmed that it has agreed to issue $6.6 Billion in preferred stock.
New Oriental Education & Technology (EDU) $0.10 EPS vs. $0.08 estimate.
New York & Co. (NWY) lowered guidance.
OSI Systems (OSIS) received a follow-on order from EDO Corporation for roughly $5.8 million.
Phillips-Van Heusen (PVH) guidance for Q4 EPS at least $0.53, previous guidance was $0.51 to 0.53 and $0.53 First Call; also reaffirmed FY08 EPS of $3.55 to 3.65 vs. $3.55 estimate.
State Street (STT) issued earnings and is indicated down 1% to 3% on thin volume after noting it sees 2008 at lower end of target.
Thornburg Mortgage (TMA) raised roughly $212 million in equity and convertible preferred securities sales; stock down 1% pre-market.
William Sonoma (WSM) lowered guidance; stock down 14% pre-market.

Jon C. Ogg
January 15, 2008

The 52-Week Low Club

247wallst — Tue, 04 Dec 2007 16:27:54 +0000

W Holding (WHI) Listing issues. Recently came out of SEC investigation. Drops to $.75 from 52-week high of $6.70.

Phillips-Van Heusen (PVH) Weak earning outlook. Down to $36.65 from 52-week high of $82.19.

AMD (AMD) Just keeps sliding. Drops to $9.22 from 52-week high of $23.

Spansion (SPSN) No recent news. Down to $4.44 from 52-week high of $15.10.

Epicept (EPCT) Prices new stock offering. Falls to $1.25 from 52-week high of $4.89.

Douglas A. McIntyre

Cramer’s Retail & Apparel Calls On The Fed (PVH, PERY, RL, DLTR, GPS, AEO)

247wallst — Wed, 05 Sep 2007 17:24:52 +0000

On tonight’s Mad Money on CNBC, Jim Cramer said he is adamant of a RATE CUT from the Federal Reserve and sticking his head out waiting for it. He still thinks the way to play this is by being in best of breed and solid retail stocks, particularly since this is FASHION WEEK. He has one play he thinks is a big buy, but there are also a couple retail stocks in fashion and apparel that you should avoid.

The one Cramer loves and thinks you should own right now is Phillips-Van Heusen (NYSE:PVH), which owns Calvin Klein. That isn’t the only brand and isn’t the only good brand. It licenses Kenneth Cole, DKNY, Joseph Abboud, and has IZOD, Bass, Geoffrey Beene. He thinks this may be immune from missing estimates and will grow from the outside of the US sales. It also has 725 outlet stores it sells through. PVH rose 1.5% to $56.00 after the Cramer call, but shares were down 1.9% in normal trading and closed at $55.18 in normal trading.

A call-in during the first ‘avoid segment’ was actually from an overstock retail specialist, and Crameragreed that there is major discounting and overstocking going on inapparel right now. Cramer still thinks the way to key off of goodretailers is by gaging the Fed ahead of rate cuts. In the call-insegment he was positive on Gap (NYSE:GPS), Dollar Tree (NASDAQ:DLTR),and American Eagle Outfitters (NYSE:AEO).

CRAMER’S AVOID LIST FOR NOW

Perry Ellis (NASDAQ:PERY) is a fairly unfashionable label that blew away earnings, but the quality of earnings was a beat because of cost cuts and they are a mid-tier fashion brand. This is also the most at risk if Cramer is wrong on the rate cuts, and he’s concerned about Perry Eliis’ future. It also gives no dividend and has no share buyback plan.

Ralph Lauren (NYSE:RL) is a best of breed clothier, and Citigroup just started it as a Buy this week. On August 8 the earnings miss punished the stock after an earnings warning. He said he gave the management the benefit of the doubt right before the retail stock slide happened. Tonight Jim Cramer is saying now that he cannot recommend this one now, and he said he’s sitting on the sidelines now. Blowing a quarter means you have to weigh the risk/reward a quarter later to make sure this isn’t a one time event.

Jon C. Ogg
September 5, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he produces the 24/7 Wall St. SPECIAL SITUATION INVESTING NEWSLETTER and he does not own securities in the companies he covers.