PVH Corp. (PVH, Financial) is experiencing a significant surge, rising by 15% after releasing its Q4 results. While the company, known for brands like Calvin Klein and Tommy Hilfiger, beat EPS expectations, it broke its streak of nine consecutive double-digit beats. Revenue dropped 4.8% year-over-year to $2.37 billion, slightly above expectations. The stock's rise is attributed to unexpectedly bullish guidance amid challenges faced by other fashion brands as consumer spending declines.

• PVH plans to initiate accelerated share repurchase (ASR) agreements to buy back $500 million in shares by 2025, part of a $5 billion repurchase authorization with $1.8 billion still available. This ASR represents about 14% of outstanding shares, indicating management's confidence in the stock's value.
• In Q4, PVH reported a strong holiday performance, exceeding expectations on a constant currency basis (-2% CC), with growth in both direct-to-consumer (D2C) and wholesale channels. The company improved sell-through relevance for its Fall 2024 product line and significantly increased profitability in North America.
• Calvin Klein launched an "explosive" spring campaign featuring Jeremy Allen White, boosting visibility and engagement. The brand continued this momentum throughout the year, showcasing stars like Kendall Jenner and Idris Elba in Q4. A flagship store opened in Paris, enhancing brand presence. Tommy Hilfiger also strengthened its brand, emphasizing its classic American cool identity.
• Despite positive Q4 results, PVH faces global macroeconomic challenges, especially in North America. After a strong holiday season, retail traffic declined in January and February, a trend affecting the entire sector. Additionally, a post-New Year slowdown in China led to reduced revenue, though the trend has stabilized.
• For Q1, PVH's guidance aligns with expectations, but the full-year adjusted EPS guidance of $12.40-12.75 exceeded analyst predictions, despite a $0.20 FX impact. Revenue is expected to remain flat or slightly increase, with EBIT margins expected to improve in the second half. The ASR will significantly reduce share count, boosting EPS.

Recent earnings in the fashion apparel sector have been mixed. Capri Holdings (CPRI, Financial) declined on earnings, while Tapestry (TPR, Financial) and Ralph Lauren (RL, Financial) performed well. Oxford Industries (OXM, Financial), targeting higher-income consumers, had a poor quarter. Investors anticipated weak guidance due to consumer spending pullbacks and looming tariffs, but PVH's bullish EPS guidance surprised many, leading to a P/E ratio of just 5.1x at the midpoint, prompting investors to buy shares.