What Happened:
Shares of fashion conglomerate G-III (NASDAQ:GIII) fell 8.5% in the morning session after the company reported first-quarter earnings results and provided earnings forecast for the next quarter, which missed analysts' expectations. Similarly, its revenue guidance for the next quarter fell short of Wall Street's estimates, with growth expected to stay flat.
On the other hand, G-III exceeded analysts' EPS expectations this quarter. Its operating margin also outperformed Wall Street's estimates. Zooming out, this was a mixed but weaker quarter for the company.
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What is the market telling us:
G-III's shares are somewhat volatile and over the last year have had 9 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago, when the stock dropped 16.2% on the news that the company reported fourth-quarter results, with revenue and EPS missing Wall Street's estimates. Its revenue guidance for the next quarter beat analysts' expectations, but looking at the company's full-year 2024 outlook, its forecasted revenue was in line, while its forecasted EPS fell short. Overall, the results could have been better.
G-III is down 19.3% since the beginning of the year, and at $27.07 per share it is trading 23.6% below its 52-week high of $35.41 from December 2023. Investors who bought $1,000 worth of G-III's shares 5 years ago would now be looking at an investment worth $1,157.
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