Bullish Case: PVH could capitalize on improving consumer demand for fashion, boosted by successful brand strategies like direct-to-consumer models and sustainable practices. If earnings exceed expectations, sentiment could dramatically shift, driving stock price above $110.

Bearish Case: Negative sentiment fueled by concerns over operational challenges and external pressures from investigations could result in a significant price decline. The persistent bearish trend, combined with high implied volatility, signals potential for a sharp downturn especially if earnings disappoint.

Potential Outcomes:

• 30% chance of price exceeding $110 driven by strong consumer demand.
• 40% probability of trading in the $95-$105 range due to earnings miss.
• 30% chance of significant decline below $90 if investigations hinder operations.

Trading Oracle: A conservative approach favors a bullish debit spread by buying the PVH Jan 2025 $100 call and selling the $105 call, capitalizing on positive sentiment from anticipated earnings. Risk is capped while potential upside exists if earnings surprise positively. Alternatively, evaluate selling a credit spread if downside risks materialize, offering a balanced risk-reward strategy.

December 20, 2024