NEW YORK (TheStreet) -- Shares of G-III Apparel Group (GIII) were dropping 17.72% to $34.42 on heavy trading volume late morning on Tuesday as the company reported lower-than-expected 2017 second quarter results.
Before today's market open, the New York City-based apparel company reported a loss of 3 cents per share, while Wall Street expected earnings of 18 cents per share.
Revenue fell 7% year-over-year to $442.3 million, below consensus estimates of $484.85 million in revenue.
For the 2016 second quarter, G-III earned 27 cents per share on revenue of $473,884.
The company said it sustained $3 million in charges during the fiscal 2017 second quarter as a result of its recent $650 million acquisition of LVMH's (LVMUY) Donna Karan clothing brand. It added that the deal should generate revenues in 2019.
G-III CEO Morris Goldfarb said the company saw a reduction in early season outerwear orders from retailers and subsequently lowered its full-year revenue guidance to $2.48 billion, down from its prior estimate of $2.56 billion.
Earnings are now projected to be in the range of $2.16 and $2.26 per diluted share, compared to $2.55 to $2.65 per share.
Wall Street is looking for 2017 earnings of $2.58 per share on revenues of $2.56 billion.
About 3.07 million of the company's shares have changed hands so far today vs. its average volume of 679,386 shares per day.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
The team rates G-III Apparel Group as a Buy with a ratings score of B-. This is driven by a few notable strengths, which it believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks the team covers. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and expanding profit margins. The team feels its strengths outweigh the fact that the company has had sub par growth in net income.
You can view the full analysis from the report here: