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Here's How Guess? (GES) Looks Placed Ahead of Q3 Earnings

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Guess?, Inc. (GES - Free Report) is likely to register a decline in the top line when it reports third-quarter fiscal 2023 results on Nov 22 after market close. The Zacks Consensus Estimate for revenues is pegged at $614 million, indicating a decline of 4.5% from the prior-year reported figure.

The bottom line of this designer, marketer and distributor of contemporary apparel, denim, handbags, footwear and other related consumer products is anticipated to decline year over year.

The Zacks Consensus Estimate for earnings per share for the quarter under review has been stable at 55 cents over the past 30 days. The figure suggests a decline from the earnings of 62 cents reported in the year-ago period.

Guess? has a trailing four-quarter earnings surprise of 3%, on average. In the last reported quarter, this Angeles, CA-based company’s bottom line missed the Zacks Consensus Estimate by 4.9%.

Key Factors to Note

The third quarter of fiscal 2023 might have been a soft one for Guess?, at least consensus numbers say so. A competitive landscape, sluggish consumer demand and higher shipping costs might have hurt the company’s performance. Also, a promotional environment and adverse foreign currency might have been added deterrents. COVID-19 restrictions in China might have also hurt the company’s revenues.

On its last earnings call, Guess? guided a 4.5% decline in third-quarter revenues, with an adjusted operating margin of about 8.1%, down roughly 280 basis points due to currency headwinds and last year's pandemic-relief package. On a constant-currency basis, the top line is expected to improve 4.5%.

The aforementioned factors raise concerns about the outcome. However, the company’s customer-centric initiatives, including omnichannel capabilities, and a focus on the speed-to-market model and store productivity should have provided some cushion.

Guess, Inc. Price, Consensus and EPS Surprise

Guess, Inc. Price, Consensus and EPS Surprise

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

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Guess? this time. 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. However, that’s not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

Guess? has a Zacks Rank #3 but an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the 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:

Dollar General (DG - Free Report) currently has an Earnings ESP of +1.58% and a Zacks Rank of 2. The company is likely to register an increase in the bottom line when it reports third-quarter fiscal 2022 results. The Zacks Consensus Estimate for the quarterly earnings per share of $2.55 suggests an increase of 22.6% from the year-ago quarter.

Dollar General’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $9.43 billion, which suggests a rise of 10.7% from the figure reported in the prior-year quarter. DG delivered an earnings beat of 2.2%, on average, in the trailing four quarters.

Dollar Tree (DLTR - Free Report) currently has an Earnings ESP of +6.31% and a Zacks Rank #3. The company is likely to register an increase in the bottom line when it reports third-quarter fiscal 2022 results. The Zacks Consensus Estimate for the quarterly earnings per share of $1.17 suggests an increase of 21.9% from the year-ago quarter.

Dollar Tree’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.84 billion, which suggests a rise of 6.6% from the figure reported in the prior-year quarter. DLTR delivered an earnings beat of 8.6%, on average, in the trailing four quarters.

Five Below (FIVE - Free Report) currently has an Earnings ESP of +10.31% and a Zacks Rank #3. The company is likely to register a bottom-line decline when it reports third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of 14 cents suggests a decline of 67.4% from the year-ago quarter.

Five Below's top line is expected to increase marginally year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $611.2 million, which indicates an increase of 0.6% from the figure reported in the prior-year quarter. FIVE has a trailing four-quarter earnings surprise of 11.6%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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