Player Avatar NetscribeConsGds (98.65) Submitted: 1/29/2007 7:53:52 AM : Underperform Start Price: $22.20 GIII Score: -282.95

G-III apparel group designs, manufactures, imports and markets an extensive range of outerwear and sportswear, including coats, jackets, pants and other sportswear items, as well as women’s suits, and dresses. The company operates its business in two segments: licensed apparel and non-licensed apparel. The licensed apparel segment includes sales of apparel brands licensed by the company from third parties. The non-licensed apparel segment principally includes sales of apparel under its own brands and private-label brands owned by retailers

Business is seasonal in nature and traditionally company has seen strong third quarter results. However, company has posted losses in the remaining quarters. G-III apparel currently holds licenses of number of fashion brands including Calvin Klein, Kenneth Cole, Guess?, Ellen Tracy and Tommy Hilfiger to name a few and bulk of company’s revenue is generated through licensing. Third quarter results of the company were driven by improvement in Calvin Klein business and private label business. The company is optimistic about its Calvin Klein line of business, as this line targets wide demographics and the brand has gained wide acceptability in the market. Also, the company is taking strides to expand its Exsto men’s line and Sean John’s women’s sportswear. However, these brands do not contribute significantly to the top line as they are still in a nascent stage.

The recent rally in the stock price indicates that these good third quarter performance and the outlook for year-end have already been discounted. The stock is trading near its 52 week high and the price-to-earnings multiple is also higher than the industry. Management expects a full-year topline growth of over 32% for year ending fiscal 2007. However, it indicates a decline in the annual revenue growth rate when compared to last years 50%. In the light of all these facts, G-III apparel does not arouse bullish sentiments considering the one-year time horizon.

Member Avatar mirayou (< 20) Submitted: 9/13/2007 12:39:37 PM
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GIII is well positioned with a stable manufacturing base when compared to the declining competitive edge of other importers who have not upgraded their production bases. This is one of the crucial requirements in the garment industry which is the fertilizing seed to promote a sustainable growth of this company and let them being able to merchandise and produce for their licensed brand labels. These different labels, each independent for updated fashion trends, are a great epicenter for the retailers to buy from. The stock will go up substantially for sure.

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