The Street’s expectations of a slow turnaround at Guess appear realistic, analyst Beder mentioned.
International Versus Domestic
There is potential upside from international and easy comps, Beder stated. He added, “We believe the company's international businesses, spearheaded by Europe have continued to recover; these gains will become even more apparent as FX issues subside in 4Q.”
The analyst expressed concern regarding the company’s domestic operations, since management seemed to have been aggressive in “moving forward outerwear and seasonal goods, which could be negatively affected by warmer weather.”
Beder estimated the North American same-store sales for Guess at -1.5 percent, which is better than the consensus expectation of -2.9 percent.
The Q4 guide could be conservative, the analyst commented. He added, “We are not expecting material positives in the near term from the domestic market, as we are increasingly convinced the company will need to materially pare back stores over the next few years and focus on the core GUESS? concepts.” The company had raised its
Image Credit: By Eva Rinaldi from Sydney Australia (Gigi Hadid) [CC BY-SA 2.0], via
|May 2016||Miller Tabak||Upgrades||Sell||Hold|
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