PVH (PVH) is facing a limited upside potential given its high exposure to Europe, Middle East and Africa amid the challenging macro backdrop environment in the region, BofA Securities said in a Thursday note.

The company's recovery in EMEA could take longer than expected as the Middle East conflict continues to impact demand in Europe, along with sales and margins of its businesses in Turkey and Middle East, the investment firm said.

PVH expects $100 million in tariff refunds in fiscal Q2, but this benefit is likely to be offset by its EMEA exposure, tariff costs, licensing transitions, and increased marketing, BofA Securities noted. Long-term margin recovery remains possible, but profit-and-loss noise will dilute progress in fiscal 2026, the brokerage added.

BofA Securities downgraded PVH to underperform from neutral, and cut its price target to $70 from $90.

Price: 70.92, Change: -1.79, Percent Change: -2.46