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Guess? (GES) to Post Q2 Earnings: What's in the Offing?

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Guess?, Inc. (GES - Free Report) is likely to post a decline in the top and bottom line when it reports second-quarter fiscal 2021 results on Sep 2. The Zacks Consensus Estimate for second-quarter loss has remained unchanged in the past 30 days at 61 cents per share. This suggests deterioration from earnings of 38 cents registered in the year-ago quarter. We note that Guess? has a trailing four-quarter negative earnings surprise of 6.8%, on average. In the last reported quarter, the company reported a negative earnings surprise of 82.8%.

The consensus estimate for quarterly revenues is pegged at $348.7 million, which suggests a decline of 49% from the prior-year quarter’s tally.

Key Factors to Note

Due to the coronavirus outbreak, Guess? had temporarily closed all stores in several regions like United States and Canada among others. While the company has reopened stores in a phased manner as coronavirus-induced restrictions were lifted, the temporary closures at some point in the fiscal second quarter are likely to have exerted pressure on performance. During its last earnings call, management stated that it expects sales in the to-be-reported quarter to witness declines similar to the fiscal first quarter. Notably, the top line was down 51.5% year over year in fiscal first quarter. Apart from this, Guess? has been witnessing higher SG&A expenses for a while now.

Nevertheless, Guess? is benefiting from its online business, especially amid the pandemic. Incidentally, the company has been on track with its digital-first initiative and has been investing in brand building through social media platforms. Further, management has been undertaking actions to curb expenses like reducing store occupancy costs and overall expenditures amid the pandemic.

Guess, Inc. Price and EPS Surprise

Guess, Inc. Price and EPS Surprise

Guess, Inc. price-eps-surprise | Guess, Inc. Quote

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Guess? 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.

Guess? carries a Zacks Rank #4 (Sell) and an Earnings ESP of +0.00%.

Stocks With a Favorable Combination

Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

PVH Corp. (PVH - Free Report) has an Earnings ESP of +55.22% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

lululemonathletica (LULU - Free Report) has an Earnings ESP of +15.75% and a Zacks Rank #3.

NIKE (NKE - Free Report) has an Earnings ESP of +6.24% and a Zacks Rank #3.

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