The Zacks Analyst Blog Highlights:DSW, PVH, Warnaco Group, Hanesbrands and Ralph Lauren

  The Zacks Analyst Blog Highlights:DSW, PVH, Warnaco Group, Hanesbrands and
                                 Ralph Lauren

PR Newswire

CHICAGO, Jan. 29, 2013

CHICAGO, Jan. 29, 2013 /PRNewswire/ announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include DSW Inc. (NYSE:DSW), PVH Corp.
(NYSE:PVH), Warnaco Group, Inc. (NYSE:WRC), Hanesbrands Inc. (NYSE:HBI) and
Ralph Lauren Corporation (NYSE:RL).


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Here are highlights from Monday's Analyst Blog:

DSW Upgraded to Strong Buy

On Jan 25, 2013, Zacks Investment Research upgraded DSW Inc. (NYSE:DSW) to a
Zacks Rank #1 (Strong Buy). The company has amassed a solid return of roughly
45.5% over the past one year.

Why the Upgrade?

DSW has been witnessing rising earnings estimates on the back of robust
third-quarter fiscal 2012 results and a sturdy outlook for fiscal 2012.
Moreover, this leading footwear and accessories retailer has outperformed the
Zacks Consensus Estimate in 7 straight quarters by an average of 11.9%.

The company declared impressive third-quarter results on Nov 20, 2012, wherein
earnings of $1.02 per share surpassed the Zacks Consensus Estimate of 89 cents
by 14.6% and increased 15.9% from 88 cents earned in the prior-year quarter
buoyed by top-line growth. Net sales rose 11.7% year over year to $592.7
million, and came ahead of the Zacks Consensus Estimate of $588 million.
Comparable sales climbed 6.3%.

Robust top-line performance, healthy operating margin, rational store
expansion strategy, strong financial position and a solid fiscal 2012 guidance
justify the stock's Zacks Rank.

Based on its strong fundamentals, management anticipates fiscal 2012 earnings
between $3.30 and $3.40 per share.

The Zacks Consensus Estimate for fiscal 2012 rose 2.1% to $3.38 per share over
the last 90 days, and has a close proximity with the upper end of the
company's guidance range. For fiscal 2013, the Zacks Consensus Estimate
advanced 2.1% over the same timeframe to $3.87 per share.

PVH Hits New 52-Week High

Shares of PVH Corp. (NYSE:PVH) – the world's largest shirt and neckwear
company – reached a new 52-week high of $121.26 on Friday, Jan 25, beating its
previous 52-week high of $119.62. The closing share price of the company on
Jan 28, 2013 stood at $120.86, representing a solid return of approximately
69.9% since Jan 3, 2012. Average volume of shares traded over the last 3
months came in at approximately 1,058,470.

Growth Drivers

An impressive record of beating the quarterly earnings expectations, a
positive fiscal 2012 outlook and expanding business through acquisition mainly
drove the upside in the shares of PVH Corp.

PVH reported an outstanding bottom-line performance in the third quarter of
fiscal 2012, driven by solid improvement in margins along with a lower tax
rate. The company's adjusted earnings per share jumped approximately 24% year
over year to $2.34, beating the Zacks Consensus Estimate of $2.29.

However, the company's total revenue inched down 1% on a year-over-year basis
to $1.643 in the year-ago quarter. The year-over-year revenue growth at the
company's Tommy Hilfiger and Calvin Klein segments were more than offset by
the decline at its Heritage Brands segment and unfavorable foreign currency
exchange rates. However, quarterly revenue surpassed the Zacks Consensus
Estimate of $1.638 billion.

Bolstered by continued growth momentum at Tommy Hilfiger and Calvin Klein
brands, the company raised its fiscal 2012 earnings guidance range to
$6.37–$6.38 per share, up from previous guidance range of $6.32–$6.37. The
current Zacks Consensus Estimate for the fiscal is pegged at $6.39 per share,
which is above the company's guidance range. Moreover, PVH Corp. expects net
sales to increase 2% from the fiscal 2011 level.

Further, we believe that the acquisition of Warnaco Group, Inc. (NYSE:WRC)
will facilitate the company to have operations at every major consumer market
in the world, which will ultimately boost its top line. It is expected that
the acquisition will increase the company's 2013 earnings by 35 cents per

Valuation Stretched, Yet Lucrative

PVH Corp. currently trades at a forward P/E of 18.92x, reflecting a 38.8%
premium to the peer group average of 13.63x. Its price-to-sales ratio of 1.48
is also at a premium to the peer group average of 1.37. Given the company's
compelling fundamentals, the premium valuation is justified and well supported
by its long-term estimated EPS growth rate of 14.5% versus 12.8% for the peer
group. The company has a market cap of approximately $8.54 billion.

Other Stocks to Consider

Apart from PVH Corp., other stocks' share prices in the industry that are
gaining momentum include Hanesbrands Inc. (NYSE:HBI) and Ralph Lauren
Corporation (NYSE:RL). Hanesbrands and Ralph Lauren's share prices rose
approximately 15.4% and 6.1%, respectively, since both the company's reported
better-than-expected bottom-line performance. All of these companies carry a
Zacks Rank #2 (Buy).

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