Guess? Inc (GES:US)
12-month performance: -35%
Insider activity: Bullish
Insider buying pattern: Large purchase from CEO
Recent news: Closed stores due to Covid-19
Guess? Inc is an American clothing company that designs, markets, and distributes clothing for men, women, and children. Founded in California in 1981, it has over 700 stores across the world today, as well as nearly 200 smaller licensee-operated concessions. The company is listed on the New York Stock Exchange and currently has a market capitalisation of $750 million.
Previous insider trades have been timed well
We last covered Guess? in mid-June last year. At the time, CEO Carlos Alberini had just purchased 347,353 GES shares, spending approximately $5 million on stock. We viewed this large purchase as a bullish signal. In hindsight, following the insider money could have been a smart move. Over the next six months, Guess? shares rose around 40% on the back of strong second-quarter results in which revenue and profits topped estimates and the company raised its full-year profit forecast.
Source: 2iQ Research
Insider buying: large CEO purchase
Naturally, Guess? shares have under performed in 2020 as the company has been forced to close its stores due to the coronavirus. What’s interesting though is that Alberini has just made another significant purchase. Indeed, according to Form 4 SEC filings, on 16 July, the insider purchased 100,000 shares at a price of $10.17 per share, spending a little over $1 million on Guess? stock. We see this large insider purchase as a positive development. Given Alberini’s industry experience and his track record when it comes to timing his purchases well, we think this insider buying activity is a bullish signal.