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Things to Know Ahead of G-III Apparel's (GIII) Q4 Earnings

Zacks Equity Research

G-III Apparel Group, Ltd. GIII is likely to report top and bottom-line growth in fourth-quarter fiscal 2020. Notably, the company’s bottom line outperformed the Zacks Consensus Estimate in each of the trailing four quarters, the average positive surprise being 11.3%.

The Zacks Consensus Estimate for fiscal fourth-quarter earnings has remained stable at 68 cents over the past 30 days. This suggests an increase of 23.6% from 55 cents earned in the year-ago quarter. The consensus mark for revenues is at $791.8 million, indicating a rise of 3.3% from the year-ago quarter’s tally.

G-III Apparel Group, LTD. Price and EPS Surprise


G-III Apparel Group, LTD. Price and EPS Surprise

G-III Apparel Group, LTD. price-eps-surprise | G-III Apparel Group, LTD. Quote

Key Factors to Note

G-III Apparel is benefiting from its robust Wholesale segment, which is likely to have driven the top and bottom line in the fiscal fourth quarter. The segment has been gaining from strength in the DKNY, Tommy Hilfiger and Calvin Klein brands. Notably, the DKNY brand has been taking a digital marketing approach, through which the company is witnessing a bump-up in traffic. Effective merchandising, sourcing and selling strategies have been boosting growth across its brands.

Further, the company is on track to expand the DKNY and Donna Karan banners. Also, G-III Apparel has been augmenting licensing agreements for these brands to reach out to a broader consumer base. It has been bolstering brands across channels through launches and improved marketing strategies. In its last earnings call, management projected net sales of $790 million for the quarter under review. It envisioned adjusted earnings of 62-72 cents per share.

However, the company’s Retail segment has been dismal for a while now. Sales decline at Wilsons and G.H. Bass has been hampering the segment’s performance. It is also witnessing softness in its Karl Lagerfeld business owing to lower distribution doors compared to the third quarter of last year. Moreover, the company is not free from concerns related to tariffs and competition.

What the Zacks Model Unveils

Our proven model does not predict an earnings beat for G-III Apparel this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Although G-III Apparel carries a Zacks Rank #2, its Earnings ESP of -0.99% makes surprise prediction difficult.

Stocks Poised to Beat Earnings Estimates

Here are a few companies you may want to consider, as our model shows that these have the right combination to post an earnings beat:

Children's Place PLCE has an Earnings ESP of +1.16% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Five Below, Inc. FIVE has an Earnings ESP of +0.32% and a Zacks Rank #3.

lululemon athletica inc. LULU has an Earnings ESP of +0.27% and a Zacks Rank #3.

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