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Guess' Names Former Inditex Executive Herrero as New CEO - Analyst Blog

Zacks Equity Research
Updated

Apparel retailer Guess’ Inc. GES is currently reshuffling its management. Co-Founder and CEO Paul Marciano will henceforth operate as Executive Chairman of the Board. Marciano will be replaced by Victor Herrero, who will be the new CEO of Guess’ effective August 2015.

Paul Marciano will replace Maurice Marciano, who will continue to serve as the Chief Creative Officer and a director of the board.

An MBA from the Kellogg School of Management, Herrero boasts 20 years of global experience in Europe and Asia. He also worked as the head of Asia Pacific for the largest fashion retailer Inditex Group which owns brands like Zara, Massimo Dutti, Pull & Bear, Bershka and Stradivarius. Herrero was also responsible for establishing the company’s presence in Asia. Prior to Inditex, he served as a management consultant for Arthur Andersen in Asia.

We believe that Herrero’s overseas experience will boost the apparel retailer’s international presence. Guess’ remains well positioned on the back of its strong e-Commerce business. Moreover, the Zacks Rank #1 (Strong Buy) company is progressing well on its three-pronged approach to increase traffic at its retail stores across North America. Its improved denim offerings and fresh competitively priced stocks have already started attracting more traffic. Additionally, the company has been able to significantly control expenses through its cost reduction initiatives.

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Tightened operating expenses helped Guess’ to report profits in the first quarter of fiscal 2016 reported last month, after incurring losses for several quarters. The company is optimistic about the rest of the year and even raised the earnings guidance for fiscal 2016.

Other Stocks to Consider

Other stocks worth a look in the textile apparel sector are Hanesbrands Inc. HBI, G-III Apparel Inc. GIII and Perry Ellis International Inc. PERY. While Perry Ellis and G-III Apparel sport a Zacks Rank #1, Hanesbrands carries a Zacks Rank #2 (Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
GUESS INC (GES): Free Stock Analysis Report
 
HANESBRANDS INC (HBI): Free Stock Analysis Report
 
PERRY ELLIS INT (PERY): Free Stock Analysis Report
 
G-III APPAREL (GIII): Free Stock Analysis Report
 
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Zacks Investment Research