G-III Apparel Group, Ltd. (NASDAQ:GIII) posted weak second-quarter results amid sales challenges. In reaction, Piper Jaffray analyst Erinn Murphy reiterates a Neutral rating on shares of GIII with a $48 price target, which represents just under a 37% increase from where the stock is currently trading.
The clothes maker reported a loss per share of $0.03, a significant dip from Murphy’s EPS projection of $0.15 and the Street’s estimate of $0.18. Meanwhile, second-quarter sales fell 7% year-over-year, hitting $442 million, which fell below Murphy’s forecast of $485 million, an estimate that hoped for a 2% year-over-year increase.
Additionally, management cut its guidance for the fiscal year of 2017 from sales of $2.56 billion to $2.48 billion and EPS from a range of $2.55 to $2.65 down to a range of $2.16 to $2.26. For third-quarter, GIII indicates a sales estimate of $940 million, compared to Murphy’s expectation of $1,021 million and the Street’s of $1,007 million. EPS is projected in a range of $1.50 to $1.60, also falling under Murphy’s projection of $2.07 and the Street’s of $2.02.
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Murphy notes, “In the release, mgmt indicated that wholesale for non-outerwear continued to be the bright spot offset by outerwear weakness and retail underperformance.”
As usual, we recommend taking analyst notes with a grain of salt. According to TipRanks, analyst Erinn Murphy is ranked #3,977 out of 4,129 analysts. Murphy has a 38% success rate and faces a loss of 8.6% in her yearly returns. When recommending GIII, Murphy loses 14.7% in average profits on the stock.
TipRanks analytics demonstrate GIII as a Buy. Based on 4 analysts polled in the last 3 months, 1 rates a Buy, while 3 maintain a Hold. The consensus price target stands at $46.75, marking a nearly 12% upside from where the shares last closed.