Morningstar Rating

Stock Research and Analysis

by Bridget Weishaar

Bulls Say

The company is closing underperforming stores and reorganizing, both of which should yield annual cost savings.
Pockets of improvement have become apparent including e-commerce growth and the Marciano line.
Guess has an almost debt-free balance sheet, generates solid free cash flows, and pursues investor-friendly activities. From fiscal 2012 to 2014, the company repurchased roughly 10% of total shares outstanding. The dividend payout ratio was over 80% in fiscal 2015. Read more 

Bears Say

Guess faces high fashion risk and has no economic moat in providing a sexy, fashion-forward, youthful lifestyle brand, with significant exposure to the declining denim market.
The product has suffered a series of fashion misses and repositioning could be unlikely under the continued leadership of Paul Marciano.
The U.S. and Southern European retail markets are relatively mature, making the company increasingly rely on emerging markets for growth. With 50% of revenue generated outside of North America, Guess is highly exposed to foreign-currency exchange rate fluctuations. Read more 

Management

Because of the board structure, consolidated shareholder ownership, and continued reliance on Paul Marciano to lead the company, we give Guess a Poor stewardship rating. Founder and CEO Paul Marciano and his brother Maurice Marciano, the chairman of   Read more 

Profile

Guess designs, markets, distributes, and licenses contemporary apparel and accessories that reflect European fashion sensibilities under brands including Guess, Marciano,  Read more 

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