This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Calvin Klein, Speedo Maker's Stock to Extend Rally, Morgan Stanley Says

Stocks in this article: WRC

BOSTON ( TheStreet) -- Shares of Warnaco Group (WRC), which owns the Calvin Klein and Speedo brands, have rallied 20% since the beginning of October. If Morgan Stanley analysts are correct, the apparel company's stock will keep rising.

Morgan Stanley analyst Joseph Parkhill says in a note today that Warnaco's share price "will rise in absolute terms over the next 60 days. This is because of an earnings release. We believe Warnaco will continue to rally as the market becomes more comfortable with 2012 estimates."

Warnaco, founded in 1874 as a corset maker, hasn't scheduled the publication of its fourth-quarter earnings, although the company will likely report results in early February. However, Parkhill argues that the first catalyst for Warnaco could come next week. On Tuesday, Warnaco confirmed it would make a presentation at the ICR XChange, an annual investor conference, on Jan. 13. Parkhill says the company may confirm fourth-quarter earnings-per-share guidance at the event.

The second catalyst, Parkhill says, would be if Warnaco offers guidance that is in line with consensus estimates on its earnings call. "We estimate that there is about a 70% to 80% or 'very likely' probability for the scenario," Parkhill writes.

Parkhill upgraded shares of Warnaco to "equal weight" from "underweight" Wednesday. Interestingly, with his optimistic view that Warnaco shares will continue to rise through earnings, Parkhill dropped his previous price target of $43, which was below the current share price of $50.95.

Warnaco, which last month announced that Chief Operating Officer Helen McCluskey would take over as president and CEO on Feb. 1, is expected to post fourth-quarter sales of $643 million and earnings of $1.02 a share. For 2012, analysts polled by Thomson Reuters expect the apparel company to report sales of $2.75 billion and earnings of $4.53 a share.

-- Written by Robert Holmes in Boston.

>To contact the writer of this article, click here: Robert Holmes.

>To follow Robert Holmes on Twitter, go to

>To submit a news tip, send an email to:

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs