NEW YORK (AP) -- Shares of PVH climbed Thursday as the clothing company announced that it is selling the G.H. Bass & Co. unit to G-III Apparel Group Ltd. for about $50 million. The company also raised its third-quarter adjusted earnings forecast.
THE SPARK: PVH Corp. said late Wednesday that the deal is expected to close in the beginning of the fiscal fourth quarter. PVH acquired G.H. Bass & Co. in 1987.
Chairman and CEO Emanuel Chirico said in a statement that PVH is now concentrating more on its lifestyle clothing businesses, in particular designer brands like Calvin Klein and Tommy Hilfiger.
PVH also boosted its third-quarter adjusted earnings outlook to about $2.25 per share, up from prior guidance of $2.20 per share. It maintained its 2013 adjusted earnings forecast of $7 per share.
Analysts polled by FactSet expect third-quarter earnings of $2.22 per share and full-year earnings of $7.07 per share.
THE ANALYSIS: Eric Beder of Brean Capital LLC views the sale as a positive for PVH, saying in a client note that the division was a distraction for the company and had limited profitability. The analyst said he's now happy that with the Bass sale, PVH can focus even more on the Calvin Klein integration.
Beder also welcomed the increased third-quarter outlook, saying it accounts for solid results in Calvin Klein for September. The analyst said he thinks Calvin Klein continues to take solid market share in the department store segment.
Beder kept a "Buy" rating and $150 price target on the stock.
SHARE ACTION: The stock added $3.93, or 3.3 percent, to $121.48 in afternoon trading. It has traded between $90.36 and $134.98 over the past year. Year to date, the shares are up 6 percent.