JP Morgan Reiterates Overweight Rating For PVH

Phillips-Van Heusen Corporation (NYSE: PVH) reported healthy 2Q EPS earnings, beating the Street's estimate by $0.18 to $0.72, and better revenues and gross margins were partially offset by higher tax rates, JP Morgan reports.

Van Heusen has raised FY2010 guidance to $3.70-3.80 (from $3.55-3.65) and for 3Q the company estimates EPS of $1.37-1.42, according to JP Morgan.

JP Morgan is raising 2010/2011 EPS estimates to $3.80 (from $3.60) and $4.70 (from $4.65) based on 84% in revenue growth and 11.4% improvement in EBIT margins.

JP Morgan writes that Debt repayment is a priority and an EPS driver and the the company is utilizing excess cash flows for this purpose. Van Heusen made a voluntary $100M payment in 2Q and anticipates another $300M in the 2H2010.

JP Morgan maintains its Overweight rating and $72 price target.

Phillips-Van Heusen Corporation closed yesterday at $54.07.

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