Guess? Misses Where it Counts

Guess? (NYSE: GES  ) reported earnings on Nov. 28. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Oct. 27 (Q3), Guess? beat slightly on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share dropped significantly.

Margins dropped across the board.

Revenue details
Guess? logged revenue of $628.8 million. The 11 analysts polled by S&P Capital IQ expected to see revenue of $621.7 million on the same basis. GAAP reported sales were 2.2% lower than the prior-year quarter's $642.8 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.43. The 15 earnings estimates compiled by S&P Capital IQ anticipated $0.44 per share. GAAP EPS of $0.43 for Q3 were 39% lower than the prior-year quarter's $0.71 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 39.4%, 380 basis points worse than the prior-year quarter. Operating margin was 9.2%, 590 basis points worse than the prior-year quarter. Net margin was 5.8%, 450 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $786.8 million. On the bottom line, the average EPS estimate is $0.95.

Next year's average estimate for revenue is $2.62 billion. The average EPS estimate is $2.17.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 721 members out of 786 rating the stock outperform, and 65 members rating it underperform. Among 229 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 217 give Guess? a green thumbs-up, and 12 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Guess? is hold, with an average price target of $31.92.

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Seth Jayson owned shares of the following at the time of publication: Guess?. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Guess?. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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