NEW YORK (AP) -- Guess Inc. shares tumbled before Thursday's opening bell after the clothing company's guidance disappointed investors.
Profit in the fiscal fourth quarter dropped 24 percent because of more markdowns on clothing, Guess said late Wednesday. Stores in Europe and North America drew fewer customers, and the company says it expects challenges from the weak economy to continue this year.
For its 2013 fiscal year, which runs through January 2014, Guess projected earnings between $1.70 and $1.90 per share on revenue between $2.60 billion and $2.64 billion. That's far short of Wall Street's view: Analysts polled by FactSet had predicted profit of $2.38 per share on revenue of $2.77 billion.
Its view for the current quarter was also well short of analyst expectations.
Analysts cut their targets for the company's stock price.
While Wedbush's Betty Chen has an "Outperform" rating on Guess, she cut her price target by $7 to $27 and slashed her earnings estimate for the year. Still, she's encouraged by Guess' hiring of a new head of merchandising and its plans to introduce new lower-priced items in time for the back-to-school shopping season.
Brean Capital's Eric Beder, another optimistic analyst with a "Buy" rating, also reduced his earnings estimate for this year and cut his price target by $2 to $28.
Jefferies analyst Randal Konik, who rates Guess shares "Hold," cut his price target by $1 to $24.
Guess shares fell $1.90, or 7.1 percent, to $25.05 in premarket trading. The stock has dropped 17 percent over the past 12 months, but is up 10 percent in 2013.