02:38 PM EDT, 08/27/2025 (MT Newswires) -- PVH (PVH) has brand and balance sheet strength to drive long-term earnings growth despite macroeconomic headwinds, UBS said in a Tuesday research report.

The brokerage said it expects the company to deliver a double-digit EPS compound annual growth rate for the long term post fiscal 2025, according to the report.

The company's Q2 results reflect a sign of stabilization after a "choppy" Q1. PVH could witness improving margins in early 2026, and its strong cash flow could encourage the company to buy back more stock, analysts wrote.

The benefits of PVH's license take-back with G-III Apparel Group ( GIII ) are showing through and expected to continue through fiscal 2026. The company's European wholesale business is on track for sequential growth, the brokerage stated.

PVH is expected to record a "nice" gross margin benefit in 2026. The company is also expected to implement a plan to mitigate the tariff impact by the next fiscal year, which will likely offset most of the effect on fiscal 2025 EPS, according to UBS.

The brokerage reiterated its buy rating on the stock and price target of $146 per share.

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