Zacks Investment Research Lowers Guess? (GES) to Hold

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Zacks Investment Research cut shares of Guess? (NYSE:GES) from a buy rating to a hold rating in a research report released on Wednesday morning.

According to Zacks, “Guess? has crushed the industry in a year, attributable to continued strength in its Europe and Asia businesses, owing to constant store openings and e-commerce growth. These have been leading to positive comps growth. Strength in these regions, along with enhanced margins fueled Guess?’s third-quarter fiscal 2019 results, wherein earnings and sales grew year over year. However, increased distribution costs hit margins in Europe and led to a rise in SG&A expenses. High marketing and advertising costs are also expected to lead to increased SG&A rate in the fourth quarter. Nonetheless, continued investments in Europe and Asia are likely to help Guess? retain its sturdy trend. Also, the company is making solid efforts to enhance Americas Retail performance, and is also witnessing improvements on this front. Encouragingly, these upsides led to a raised fiscal 2019 outlook.”

Other analysts have also issued research reports about the stock. Telsey Advisory Group increased their price objective on shares of Guess? from $26.00 to $28.00 and gave the stock a market perform rating in a research note on Thursday, August 30th. TheStreet upgraded shares of Guess? from a c+ rating to a b rating in a research note on Thursday, August 30th. Four equities research analysts have rated the stock with a hold rating and two have issued a buy rating to the stock. The stock currently has a consensus rating of Hold and a consensus price target of $22.60.

NYSE:GES opened at $21.84 on Wednesday. The firm has a market capitalization of $1.87 billion, a PE ratio of 31.20, a price-to-earnings-growth ratio of 1.29 and a beta of 0.19. Guess? has a 1-year low of $14.17 and a 1-year high of $26.95. The company has a current ratio of 1.93, a quick ratio of 0.95 and a debt-to-equity ratio of 0.04.

Guess? (NYSE:GES) last released its quarterly earnings data on Wednesday, November 28th. The company reported $0.13 earnings per share for the quarter, missing the Zacks’ consensus estimate of $0.16 by ($0.03). The business had revenue of $605.00 million during the quarter, compared to analyst estimates of $603.08 million. Guess? had a positive return on equity of 8.42% and a negative net margin of 0.32%. The firm’s revenue was up 10.2% compared to the same quarter last year. During the same quarter in the previous year, the company earned $0.12 EPS. Research analysts predict that Guess? will post 1.02 EPS for the current fiscal year.

The company also recently declared a quarterly dividend, which will be paid on Wednesday, January 2nd. Investors of record on Wednesday, December 12th will be issued a dividend of $0.225 per share. This represents a $0.90 dividend on an annualized basis and a yield of 4.12%. The ex-dividend date of this dividend is Tuesday, December 11th. Guess?’s dividend payout ratio (DPR) is presently 128.57%.

A number of hedge funds and other institutional investors have recently made changes to their positions in the stock. BlackRock Inc. boosted its holdings in Guess? by 1.8% during the third quarter. BlackRock Inc. now owns 8,116,668 shares of the company’s stock worth $183,437,000 after buying an additional 140,223 shares in the last quarter. Vanguard Group Inc. boosted its holdings in Guess? by 1.8% during the third quarter. Vanguard Group Inc. now owns 5,839,117 shares of the company’s stock worth $131,965,000 after buying an additional 104,828 shares in the last quarter. Elk Creek Partners LLC purchased a new stake in Guess? during the third quarter worth $13,265,000. Majedie Asset Management Ltd boosted its holdings in Guess? by 2.7% during the third quarter. Majedie Asset Management Ltd now owns 570,301 shares of the company’s stock worth $12,889,000 after buying an additional 14,997 shares in the last quarter. Finally, Principal Financial Group Inc. boosted its holdings in Guess? by 1.2% during the first quarter. Principal Financial Group Inc. now owns 454,045 shares of the company’s stock worth $9,417,000 after buying an additional 5,421 shares in the last quarter. 70.61% of the stock is currently owned by hedge funds and other institutional investors.

Guess? Company Profile

Guess?, Inc designs, markets, distributes, and licenses lifestyle collections of apparel and accessories for men, women, and children. It operates through five segments: Americas Retail, Americas Wholesale, Europe, Asia, and Licensing. The company's clothing collection includes jeans, pants, skirts, dresses, shorts, blouses, shirts, jackets, knitwear, and intimate apparel.

Read More: What is an Initial Public Offering (IPO)?

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