The 10-second takeaway
For the quarter ended July 28 (Q2), Guess? met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share contracted significantly.
Margins dropped across the board.
Guess? reported revenue of $635.4 million. The 11 analysts polled by S&P Capital IQ expected revenue of $629.9 million on the same basis. GAAP reported sales were 6.2% lower than the prior-year quarter's $677.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.49. The 12 earnings estimates compiled by S&P Capital IQ forecast $0.50 per share. GAAP EPS of $0.49 for Q2 were 25% lower than the prior-year quarter's $0.65 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.6%, 470 basis points worse than the prior-year quarter. Operating margin was 9.0%, 790 basis points worse than the prior-year quarter. Net margin was 6.8%, 220 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $624.0 million. On the bottom line, the average EPS estimate is $0.45.
Next year's average estimate for revenue is $2.64 billion. The average EPS estimate is $2.22.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 657 members out of 720 rating the stock outperform, and 63 members rating it underperform. Among 198 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 185 give Guess? a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Guess? is outperform, with an average price target of $35.60.
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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 owns shares of Guess?. 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.