Unlike Perry Ellis (NASDAQ:PERY), which I reviewed the other day, Phillips-Van Heusen (NYSE:PVH) just might be an apparel stock that's worth a closer look. After all, PVH has less debt and a better return on capital, and the shares might just be undervalued. And besides, Phillips-Van Heusen has The Donald, and doesn't every Ivy League Apprentice wannabe want to dress like The Donald?

Third-quarter results looked pretty good on the rack. Sales were up about 13%, fueled by good sales in dress shirts and sportswear. Signature lines such as Chaps, Sean John, and Donald Trump boosted shirts, while Calvin Klein did the heavy lifting in sportswear. Margins also picked up nicely at both the gross and operating levels. On the bottom line, excluding year-ago restructuring costs, net income grew more than 30%.

I don't believe there's any particular secret here with the company. Brands such as Van Heusen, Bass, IZOD, Calvin Klein, and Arrow continue to sell well because they're appealing from both a style and price perspective. And we've seen in the retailing world that good concepts (Abercrombie & Fitch (NYSE:ANF) and Chico's (NYSE:CHS)) will thrive, while out-of-touch concepts (Hot Topic (NASDAQ:HOTT) and, increasingly, Gap (NYSE:GPS)) will have a more difficult time.

My major concern with Phillips-Van Heusen at this point is its sales channel. There's nothing wrong with selling to Wal-Mart or department store staples such as Kohl's (NYSE:KSS) or J.C. Penney (NYSE:JCP). But those places aren't where the hot retailing growth has been. Is this going to leave the company more vulnerable to a slowdown in mall traffic? I'm inclined to say "no," and I happen to believe that the demise of the department store has been exaggerated. But it still rates as a concern.

Plugging numbers into my cash flow valuation model, I see both good and bad news. The stock would still seem to be undervalued, although not so much as to fall within my margin of safety standards. Should there be a retail-wide freakout, though (say, because of a disappointing after-Thanksgiving Friday), I might take a second look.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).