KeyBanc Cuts Price Target on G-III Apparel (GIII), Remains Optimistic on Calvin Kline Handbags
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Price: $33.70 +1.57%
Rating Summary:
10 Buy, 8 Hold, 3 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
10 Buy, 8 Hold, 3 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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KeyBanc is maintaining its Buy rating on shares of G-III Apparel (NASDAQ: GIII) and is lowering its price target on them from $42 to $39.
The company reported poor second quarter results with earnings falling well below expectations. The earnings miss was largely due to weak margins, gross margins for the second quarter fell 364 bps year-over-year. Revenue topped expectations on strong handbag and dress sales.
Management remains optimistic with its Calvin Kline handbags and the firm believes that its long-term $200 million revenue target may prove to be conservative. The note that the business will be in 700 doors in the fall, well above the 300 doors mark in the spring.
An analyst at KeyBanc comments, "We anticipate outerwear sales to be strong this fall and holiday, given good early reads on coats that began to ship at the end of July. Additionally, the Company raised pricing on coats this year and has not seen any resistance to the higher prices to date."
The firm is cutting its 2011 EPS estimate from $3.21 to $3.10 and is reiterating its 2012 estimate of $3.80. KeyBanc also raised its 2011 and 2012 revenue estimates from $1.2 billion and $1.34 billion to $1.25 billion and $1.4 billion.
For more ratings news on G-III Apparel click here and for the rating history of G-III Apparel click here.
Shares of G-III Apparel closed at $28.66 yesterday.
The company reported poor second quarter results with earnings falling well below expectations. The earnings miss was largely due to weak margins, gross margins for the second quarter fell 364 bps year-over-year. Revenue topped expectations on strong handbag and dress sales.
Management remains optimistic with its Calvin Kline handbags and the firm believes that its long-term $200 million revenue target may prove to be conservative. The note that the business will be in 700 doors in the fall, well above the 300 doors mark in the spring.
An analyst at KeyBanc comments, "We anticipate outerwear sales to be strong this fall and holiday, given good early reads on coats that began to ship at the end of July. Additionally, the Company raised pricing on coats this year and has not seen any resistance to the higher prices to date."
The firm is cutting its 2011 EPS estimate from $3.21 to $3.10 and is reiterating its 2012 estimate of $3.80. KeyBanc also raised its 2011 and 2012 revenue estimates from $1.2 billion and $1.34 billion to $1.25 billion and $1.4 billion.
For more ratings news on G-III Apparel click here and for the rating history of G-III Apparel click here.
Shares of G-III Apparel closed at $28.66 yesterday.
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