Why G-III Clothing Stock Soared Today

Actions of G-III Clothing (III) were on the move today, jumping after the apparel licensing company posted better-than-expected results in its fiscal second quarter 2025 earnings report.

As of 1:03 PM ET, the stock was up 24.3% on the news.

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G-III soars again

Revenue in the quarter ended July 31 continued to slide at G-III, falling 2% to $644.8 million, which was below estimates of $649.4 million. G-III owns brands such as DKNY and Karl Lagerfeld and licenses others such as Calvin Klein, but the company successfully manages the business to increase profits.

However, investors responded favorably to results below the P&L as adjusted earnings per share (EPS) rose from $0.40 to $0.52, easily beating the consensus estimate of $0.27 USD. A 24% reduction in inventories to $610.5 million also helped boost profit, and the company cut selling, general and administrative (SG&A) expenses by 4% to $229 million.

Management said the performance of owned brands was strong, with DKNY and Karl Lagerfeld growing by double digits. The company also added a new licensing deal with Converse this quarter.

CEO Morris Goldfarb said the company is raising its earnings estimates for the year, adding: “Despite the macroeconomic environment, we remain optimistic about the remainder of the year and our order book is well positioned for the important fall and holiday seasons “.

Can the G-III keep climbing?

G-III continues to forecast a 3% increase in net sales to $3.2 billion, in line with estimates. Bottom line, meanwhile, it raised its adjusted EPS forecast from a range of $3.58 to $3.68 to a range of $3.95 to $4.05, compared to $4.04 last year fiscal 2024 and analyst consensus at $3.66.

Based on this forecast, G-III trades at a forward P/E of less than 8. There is more upside for the stock if it can return to growth and continue to improve its margins.