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On 31 January 2019, G-III Apparel Group, Ltd. (NASDAQ:GIII) announced its earnings update. Overall, analysts seem fairly confident, with profits predicted to increase by 21% next year relative to the past 5-year average growth rate of -2.8%. Presently, with latest-twelve-month earnings at US$138m, we should see this growing to US$166m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you can research its fundamentals here.
How will G-III Apparel Group perform in the near future?
The view from 9 analysts over the next three years is one of positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of GIII's earnings growth over these next few years.
From the current net income level of US$138m and the final forecast of US$208m by 2022, the annual rate of growth for GIII’s earnings is 13%. EPS reaches $4.07 in the final year of forecast compared to the current $2.81 EPS today. In 2022, GIII's profit margin will have expanded from 4.5% to 5.8%.
Future outlook is only one aspect when you're building an investment case for a stock. For G-III Apparel Group, there are three fundamental aspects you should further research:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation: What is G-III Apparel Group worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether G-III Apparel Group is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of G-III Apparel Group? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.