G-III Apparel Group, Ltd.

G-III Apparel Group, Ltd. (GIII - Snapshot Report) analysts are projecting impressive earnings growth in a very difficult sector. Shares are currently cheap as the PEG is near 0.4.

Company Description

G-III Apparel Group, Ltd. designs, manufactures, imports and markets an extensive range of leather & non-leather apparel including coats, jackets, pants, skirts & other sportswear items.

The company's brands include Kenneth Cole, Calvin Klein, Dockers and many other well known names. G-III also has licenses with the NFL, NBA, MLB and several college sports programs. Company headquarters are in New York, where it employs over 700 people, and carries a market cap of nearly $200 million.

Sales Up 35%

On Sep 9 G-III announced quarterly sales of $113.5 million, up 35% year-over-year and the highest second quarter on company record.

The net result was a loss of 23 cents per share. While the loss was bigger than last years 5 cents per share, it was due to the acquisition of Andrew Marc businesses and Wilsons outlet chain.

Analysts were expecting a loss of 25 cents, good enough for the third consecutive earnings surprise. The loss is not atypical in such a cyclical industry.

The company also reiterated its full-year guidance, earnings of between $1.35 and $1.40 per share. Analysts are on the higher end with the consensus coming in at $1.39.

Growth Rates at a Bargain

Current estimates for the current year are $1.39, a 25% increase over fiscal 2008. Full-year 2010 estimates are averaging $1.59, 14% higher than 2009 projections.

Shares are trading at a nearly 7 times forward earnings. The PEG ratio is roughly 0.4, assuming a long-term growth rate of 17.5%.

The Chart

Shares of GIII have seen a rapid decline in the past few sessions and are now pressuring a level of support just under $12. Take a look at the chart below.