Should Investors Revisit PVH After a 25% Share Price Drop in 2025?

• If you’ve ever wondered whether PVH is a hidden gem or a value trap, you’re in the right place for a clear-eyed look at what the numbers say.
• Despite some bright spots in the past few years, PVH shares have dropped 25.3% year-to-date and are down 8.0% over the past month, raising eyebrows among growth-minded investors and bargain hunters alike.
• Recent industry headlines have put renewed focus on fashion retailers and global brands, with sustainability efforts and evolving consumer habits shaping expectations for market leaders like PVH. As competitors announce bold new initiatives and consumer trends continue to shift, the spotlight on value and adaptability has grown even sharper.
• Right now, PVH earns a 5/6 valuation score for being undervalued in five out of six key checks. With this in mind, it is worth breaking down the numbers, reviewing traditional valuation approaches, and exploring why there may be a smarter way to think about fair value by the end of this article.

Find out why PVH's -20.3% return over the last year is lagging behind its peers.

Approach 1: PVH Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model projects a company's future cash flows and then discounts them back to today's value, offering an estimate of what the business is really worth based on those expected future earnings.

For PVH, current free cash flow stands at $446.9 Million. Analyst projections, combined with extrapolations, show free cash flows rising over the next decade and reaching approximately $604.4 Million by 2035. Analysts typically provide reliable estimates for up to five years, so projections beyond that are extrapolated to complete the 10-year outlook.

Based on this methodology, the DCF calculation produces an intrinsic fair value of $118.82 per share. This suggests PVH stock is trading at a 34.1% discount to its intrinsic value, indicating significant undervaluation by the market at present.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests PVH is undervalued by 34.1%. Track this in your watchlist or portfolio, or discover 833 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for PVH.

Approach 2: PVH Price vs Earnings

When analyzing the valuation of a profitable company like PVH, the Price-to-Earnings (PE) ratio is a widely used metric because it connects the current share price to the company’s actual earnings. It gives investors a quick sense of how much they are paying for each dollar of profit, making it especially relevant for brands with consistent earnings.

It is important to remember that what counts as a “normal” PE ratio can vary. Companies with stronger earnings growth potential or lower risks tend to justify higher PE ratios, while companies facing challenges usually trade at lower multiples. Industry context matters too. PVH operates within the Luxury sector, where the average PE sits at 19.1x, while the peer average is an even richer 28.9x. In comparison, PVH’s current PE ratio is only 8.0x, signaling a significant discount relative to both benchmarks.

To move beyond broad comparisons, Simply Wall St introduces the “Fair Ratio,” a proprietary multiple designed to reflect what would be reasonable for PVH specifically. The Fair Ratio for PVH is calculated at 18.7x, which factors in not just industry trends or peer behavior but also the company’s growth prospects, profitability, risk profile, and overall market position. This provides a more meaningful yardstick for valuation than straightforward comparisons with peers or industry.

With PVH’s current PE ratio at 8.0x, well below the Fair Ratio of 18.7x, the stock appears strongly undervalued through this lens.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1411 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your PVH Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is simply your investment story, a way to capture your outlook on a company by tying together your assumptions for future revenue, profit margins, and valuation multiples into one coherent forecast and fair value.

Narratives connect the dots between a company’s business story and its projected financials, letting you see how your personal perspective translates into an up-to-date fair value estimate. On Simply Wall St’s Community page, millions of investors use Narratives as an intuitive tool to build, edit, and quickly compare their assumptions to price targets and to each other, no expert modeling required.

By comparing each Narrative’s fair value with the current share price, you can decide whether to buy, hold, or sell, all based on your conviction and what the market is pricing in. The platform keeps Narratives dynamic, as they automatically update when new news, earnings, or industry developments are released, so you always have the latest view matching your beliefs.

For example, with PVH, one bullish Narrative is based on expansion into Asia-Pacific and Europe, forecasting a fair value as high as $148. A more cautious Narrative, focused on tariff and margin risks, supports a fair value as low as $70. This demonstrates how your outlook directly shapes your investment decisions.

Do you think there's more to the story for PVH? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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