PVH Corp. (PVH) is finding itself to be resilient to the political problems that have proved persistent pressures on peers.
Shares of the New York-based clothing maker were up nearly 1% to $110.62 as of 12:30 p.m. ET as the stock moved from its pre-market dip amid bullish trading volume on the open.
However, part of the picture of future profitability that the company provides resides far from the company's New York headquarters.
"Our international businesses continue to experience momentum driven by strong growth in Europe where our performance has been outstanding," CEO Manny Chirico told analysts during a fiscal third quarter earnings call on Friday morning. "Our brands arevery desirable and we are gaining share with both new and existing consumers."
Even laggard brands, like the Calvin Klein line that was blamed for after-market declines, saw robust international growth. Chirico said this was reflective of a "healthy top line" abroad for brands like Calvin.
"In Asia our business performed well as a whole," he added, assuaging concerns over tariffs and trade issues that have clouded the forecast for many retailers.
While he did acknowledge the potential further impact of the trade war should further tariffs come into play on Jim Cramer's Mad Money program Thursday evening, he noted that results so far seem unaffected.
"Despite this backdrop we continue to see strong results out of China," he told analysts. "Both our China and our Japan businesses continue to deliver strong growth across all channels with exceptional performance in e-commerce businesses."
Chirico noted that partnerships with Alibaba Holdings' (BABA) Tmall is particularly helpful, along with local brand ambassadors, for maintaining brand strength amid external pressures and should buoy performance moving forward.
The company has also touted its ability to control inventory amid potentially pumped on pressures on products ensnared in the Sino-American standoff on trade.
"As a result of potential new China tariffs, we continue to increase our investments in basics and core product, particularly in Tommy Hilfiger, to capitalize on strong business trends," Chirico said. "In addition, at year-end, we expect inventory levels to be in line with future sales growth."
Such controls will be pivotal amid a potential squeeze on already shrinking margins.
Analysts following the stock noted that the company's history suggests a strong ability to deliver on its promised action.
"PVH noted that CK product issues were tough, but isolated to the Jeans and Collection categories-with all other categories performing well," Credit Suisse analyst Michael Binetti said. "We do believe PVH's comments that it took aggressive measures to clear underperforming CK Jeans/Collection product in 3Q and we'd note PVH does have a solid history of acting quickly to get out of inventory issues."
Tommy Will Travel
Aside from taking care of concerns at Calvin, the global trends at leading brand Tommy Hilfiger were particularly encouraging to analysts on Wall Street.
"There was a lot of good news from Tommy in the third quarter," Binetti said. "Tommy Hilfiger posted incredibly strong and accelerating international same store sale trends and, similar to Calvin Klein, we also think Tommy is off to a solid start this holiday."
Binetti set a $125 price target for the stock and an "Outperform" rating for the stock based in part on his projection of continued growth in the brand ahead.
The growth charted in the brand has certainly been significant as of late.
"International revenues increased 16% in the third quarter and comps were up 13% again exceeding our expectations as Europe and Asia both posted outstanding performance," Chirico detailed on Friday morning. "Europe performance continues to be robust despite its challenging consumer backdrop in Europe."
Chirico also noted that slowdown in Europe that many retail analysts have voiced concerns over is something he is not seeing in his brand.
The growth trends across the emerging regions, including China, made up for lagging same store sales on the company's North American home turf, and the stock is reacting accordingly.
To be sure, traffic trends could be tempered in the months ahead, Chirico warned.
"I do want to note that while our Chinese business performed well and was ahead of plan we have experienced some softer trends in traffic related to a softening economy and the related trade concerns between China and the U.S," he said.
Chirico added that international tourist traffic has also begun a troubling trend, which could temper some bullishness on the international figures.
So, while the company is capitalizing on the international growth engine, the forecast should be sprinkled with a grain of salt as the company will need to show results into 2019.
"While the outlook is calling for meaningful improvement on the horizon, investors will likely continue to debate the trajectory of the brand in the near-term," Wells Fargo analyst Ike Boruchow wrote in his take on earnings.
For now, positivity is seizing the day as shares have remained positive throughout morning trading.