Guess? Awaits Earnings Verdict: Analyst's Crystal Ball Foresees No Visibility for Improved Outlook

Telsey Advisory Group analyst Dana Telsey reiterated a Market Perform rating on the stock of Guess?, Inc. GES with a price target of $23.
Guess? will report first-quarter earnings on Wednesday, May 24, after the market close.
Guess?'s 1Q23 will face a "tough" prior-year comparison that gained from COVID subsidies and favorable timing of shipments.
Additionally, the analyst cautions that the company's overall outlook reflects a cautious consumer spending environment in the U.S. and uncertainties in Europe.
Tighter inventories at retail could pressure the wholesale channel in the quarter to be reported, added the analyst.
Guess? will also bear the brunt of the ongoing impact of macro and inflationary headwinds, evident in the company's cautious view of the year ahead.
Overall, Dana sees "no real visibility" of an improved operating environment for Guess?.
The analyst expects the company's sales to decline 6.5% Y/Y to $555 million, with 400 bps of gross margin contraction to 37.6%.
Dana also forecasts 800 bps of operating margin contraction to 1.1% loss.
However, the analyst sees the appointment of Markus Neubrand as CFO, effective August 1, as a positive as this will remove a layer of uncertainty within the senior management team going forward.
Also Read: Guess? Inks Exchange & Subscription Agreements To Extend Maturity Of Significant Portion Of Debt To 2028
Price Action: GES shares are trading lower by 2.85% at $17.53 on the last check Monday.
Photo via Wikimedia Commons

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