NEW YORK (TheStreet) -- Guess? (GES) - Get Report stock is up 9.05% to $18.25 in early morning trading Thursday despite Jefferies' price target reduction to $21 from $23, while maintaining its "hold" rating following the release of the apparel retailer's fourth quarter earnings report. 

"Constant currency trends, particularly in the U.S. and in key areas of Europe, like Italy, are starting to show signs of life with lower promotional posturing, lean inventories and improving product response," Jefferies said. 

The retailer reported fourth quarter net income of $53.9 million, or 63 cents per share, exceeding analysts' estimates of 58 cents per share.

Net income declined by 24.1% from the same period last year.

Guess? reported a 9% decline in fourth quarter revenue to $696.7 million, falling short of analysts' $704.3 million expectations.

Although North America retail same-store sales fell 5% in the fourth quarter, analysts expect positive underlying momentum to accelerate over the course of the year as West Coast port issues abate, weather normalizes and design enhancements begin to flow through to the product assortment. 

"FX headwinds continue to weigh on European results, while weaker consumer confidence and economic headwinds present another level of challenges," Jefferies said, adding that the FX headwinds and lack of visibility around sustainable top line improvement contributed to the decision to reduce its price target. 

The firm noted that management provided a relatively upbeat outlook for the year ahead that contemplates sequential improvement in sales and margins over the course of the year so as to improve profitability across the fleet and achieve lean inventory levels to drive gradual restoration of price integrity. 

Separately, TheStreet Ratings team rates GUESS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate GUESS INC (GES) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."

You can view the full analysis from the report here: GES Ratings Report

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