G-III Apparel Group (GIII) - Due Diligence

hourglass

Loading…

Preparing the latest DD data, styles and content.

64OpportunityDD: Sep 19, 2026Analyst: 75

paidPrice at analysis date

USD 32.6 (19/09/2026)

domainMkt cap

$1.37B

pie_chartShares

41.9M

candlestick_chart52W

$24.61-$37.54

trending_downShort interest

10%

INFONASDAQConsumer Discretionary4500 employeesFounded 1974

Verdict: Favorable Risk/Reward

Deep-value apparel branded company: cash-adjusted P/E ~8.6x, net cash 29% of market cap, Q2 FY27 beat + raised full-year guidance, CEO buying stock. Offset by pending securities class action (Levi & Korsinsky) and 2027 Calvin Klein/Tommy Hilfiger license expiry that will remove ~40% of legacy revenue. Owned brands (Karl Lagerfeld, DKNY, Donna Karan, Vilebrequin) growing double-digit and increasingly cover the gap. Base case fair value ~$38, +17% vs $32.59.

📊 DIANALITICS RESEARCH INDEXCompany & Thesis Assessment Score /100 — updated 2026-09-19

G-III Apparel Group (GIII)

Consumer Discretionary / Apparel · NASDAQ · New York

"Cheap, cash-rich brand licensee in mid-transition — beat-and-raise cadence resumed, litigation and license roll-off cap upside"

Net cash 29% mkt cap Insider buying Class action pending PVH license roll-off 2027 Fwd P/E ~11x ex-cash

Fin. strength

/20 pts

EBITDA/FCF

/15 pts

Debt/leverage

/15 pts

Stage/business

/15 pts

Catalysts

/10 pts

Reg. risk

/8 pts

Risk/reward

/7 pts

Management

/5 pts

Sector/macro

/3 pts

Compliance

/2 pts

💡 Fair Value estimate — P/E on FY27E EPS + Net cash cushion

Fair value base case

USD 38.0

Range: USD 27.0-USD 44.0

Price at analysis date: USD 32.6 (19/09/2026)

Base upside/downside: +17%

Primary — forward P/E 10.0x on FY27E adj EPS $2.80, plus per-share net cash and small option/litigation adjustments. Implied EV/EBITDA fwd ≈ 5.5x (consistent with peer median). Sensitivity: ±1x P/E → ±$2.80/sh (~±7.5%). Peer set (OXM, CRI, HBI, MOV) trades 8.5-13.5x fwd P/E; GIII sits at median, discount emerges only after netting cash. Consensus average $34.50 (mid-Sep 2026) sits between base and bull. ⚠️ Not investment advice.

Component	Assumption	USD/share
Business value (P/E)	FY27E adj EPS $2.80 × 10.0x fwd P/E (peer median 10.5x −0.5x license drag)	+28.00
Net cash	($407M cash − $10.6M debt) / 41.9M sh = $396.4M / 41.9M	+9.46
Owned-brand option value	25% prob × $150M incremental EBITDA from Karl Lagerfeld + Vilebrequin scaling FY28-30 (~$37.5M NPV) / 41.9M sh	+0.90
Litigation reserve (Levi&K.)	50% prob × $30M settlement scenario / 41.9M sh	−0.36
PVH transition drag	Multiple compression already in 10.0x (vs peer 10.5x median): no double-count	+0.00
FV base case	Sum: 28.00 + 9.46 + 0.90 − 0.36	≈ $38.0

Bull

$42–$48

Probability: 20%

Karl Lagerfeld & DKNY revenue fully offset PVH loss by FY28; FY28 adj EPS ~$3.50; multiple re-rates to 11.5x on execution proof; class action settled cheaply.

Base

$34–$40

Probability: 50%

FY27 guidance met (~$2.80 adj EPS), FY28 revenue down 15-20% on PVH exit but stabilizing; multiple stays 9.5-10.5x; net cash cushion holds.

Bear

$22–$28

Probability: 30%

Wholesale/department-store recession, more Saks-like bad-debt events; PVH gap not filled; litigation reserve escalates; multiple compresses to 8x on lower EPS $2.20.

Methodology: Primary — forward P/E 10.0x on FY27E adj EPS $2.80, plus per-share net cash and small option/litigation adjustments. Implied EV/EBITDA fwd ≈ 5.5x (consistent with peer median). Sensitivity: ±1x P/E → ±$2.80/sh (~±7.5%). Peer set (OXM, CRI, HBI, MOV) trades 8.5-13.5x fwd P/E; GIII sits at median, discount emerges only after netting cash. Consensus average $34.50 (mid-Sep 2026) sits between base and bull. ⚠️ Not investment advice. Not investment advice.

warning

🚨 Active securities class action — Levi & Korsinsky (filed March 2026)

Investigation and class action allege management concealed a material Saks Global bankruptcy exposure (~$17.5M bad debt), particularly during the Q3 FY26 earnings call on 2025-12-09. Not currently a going-concern issue, but a real litigation reserve overhang until settled or dismissed. Monitor for lead plaintiff deadlines and any preliminary rulings.

check_circle

✅ CEO open-market buy — $1.12M at $29.00 (2026-09-14)

Founder/CEO Morris Goldfarb purchased 40,000 shares for ~$1.12M on 2026-09-14, immediately after the Q2 FY27 beat-and-raise print (Sep 2). Skin-in-the-game signal from the highest-conviction insider; historically Goldfarb open-market buys have preceded multi-quarter rallies.

⚠️ Methodology note: G-III is undergoing a structural transition — Calvin Klein license expires December 2027, Tommy Hilfiger February 2027. Combined these accounted for ~40% of FY25 revenue. FV framework uses steady-state P/E on go-forward brand portfolio (Karl Lagerfeld, DKNY, Donna Karan, Vilebrequin, Nautica, Halston) plus a ~two-year revenue transition drag already reflected in FY27–FY28 estimates. Peer comparison uses branded apparel wholesalers/licensees.

📊 Capital Structure · Short Interest · Buyback & Dilution

🟡 Short Interest

~10%

~4.2M shares short on ~41.9M outstanding, ~4.5 days to cover. Interpretation: moderate skeptic base — mostly PVH-transition bears, not distress-driven.

🟢 Share dilution (1Y)

−4%

Shares down from ~43.6M to ~41.9M via active buyback. Cause: $75M repurchase program executed FY26, offsetting equity comp dilution.

🟢 Buyback + Dividend

$75M + $0.15/qtr

FY26 repurchase executed; first-ever quarterly dividend of $0.15 initiated Dec-2025 (~1.8% yield). Cash return story new.

Short Interest — context

GIII — ~10%

~10%

Insider transactions last 12 months: CEO Morris Goldfarb bought 40,000 sh for $1.12M @ $29.00 on 2026-09-14 — first material open-market buy in 3+ years. CFO Neal Nackman and COO Dana Perlman had routine PSU vestings / RSU grants (non-open-market). No insider sales >$500K reported YTD. Net insider signal: bullish.

$Financial analysis — FY2026 (ended Jan 2026) & FY2027 outlook

FY26 Revenue

$2.96B

−7% YoY (PVH shift)

FY26 Adj EPS

$2.61

Incl. $0.30 Saks bad-debt hit

Net cash

$396M

29% of market cap

FY27E Adj EPS

$2.70–$2.90

Raised post-Q2 print

Item	FY24	FY25	FY26	FY27E	Guidance FY27
Revenue ($B)	3.10	3.18	2.96	2.83	~$2.80–2.85B
Adj EBITDA ($M)	245	265	225	215	Not disclosed
Adj EPS ($)	3.55	3.70	2.61	2.80	$2.70–$2.90
Cash ($M)	178	340	407	~440	—
Total debt ($M)	134	224	10.6	~10	Notes retired FY26
Net cash ($M)	44	116	396	~430	—

Note: Fiscal year ends Jan 31. FY26 = year ended Jan 2026. Balance sheet transformed FY26: $400M senior secured notes redeemed at par, leaving essentially net-cash. FY27E consensus assumes PVH-transition preparation year (Calvin Klein exits Dec 2027, Tommy Hilfiger exits Feb 2027).

Quarterly dynamics — last 5 quarters (fiscal calendar)
Metric	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27	Q2 FY27
Revenue ($M)	645	1,090	619	584	613
Gross margin %	41.8%	38.5%	36.2%	42.5%	43.0%
Adj EPS ($)	0.54	1.40	−0.75	−0.15	0.46
Cash EoP ($M)	145	210	407	385	410

Financial position and sustainability

Net cash / Market cap

29%

FCF conversion (adj)

~75%

Owned-brand revenue mix

~35%

PVH-licensed revenue (roll-off 2027)

~38%

account_tree

Business model — Branded apparel: owned + licensed portfolio

Portfolio of fashion brands, wholesale to department stores + growing DTC

G-III designs, sources and markets women's and men's apparel under owned brands (DKNY, Donna Karan, Karl Lagerfeld, Vilebrequin, Nautica, Halston, G.H. Bass) and licensed brands (Calvin Klein and Tommy Hilfiger from PVH — expiring 2027; Levi's, Guess, plus Team Sports licenses NFL/NBA/MLB). Distribution primarily wholesale to US department stores (Macy's, Nordstrom, Dillard's), plus international, e-commerce, and small owned retail. Company is transitioning from licensee-heavy to owned-brand-heavy model: strategic pivot completed via Karl Lagerfeld acquisition (2024) and Donna Karan license conversion. Historical operating margins 5-8%; balance sheet just deleveraged (net cash 29% mkt cap after Aug-2025 $400M notes redemption).

Owned brands (Karl Lagerfeld, DKNY, Donna Karan, Vilebrequin) ~$1.0-1.1B FY27E (35% rev) 🟢 ramping Higher GM (~48-52%) vs licensed. Karl Lagerfeld growing double-digit globally; Vilebrequin luxury swimwear stable premium; DKNY re-launched activewear. Strategic engine for post-PVH era. PVH licenses (Calvin Klein + Tommy Hilfiger) ~$1.05B FY27E (38% rev) 🔴 sunset 2027 CK license expires Dec-2027, TH Feb-2027. Combined ~$1.1B revenue exiting. GM lower (~28-32%) than owned; EPS impact per management ~$1.20-1.50 that must be replaced by owned + other licenses. Other licenses + Team Sports + Nautica ~$0.75-0.80B FY27E (27% rev) 🟡 stable/mixed Nautica, Halston, Levi's outerwear, Guess handbags, NFL/NBA/MLB Team Sports. Mostly flat/low-single-digit growth; Team Sports benefits from event-driven seasonality (Super Bowl, World Series).

gavel

Legal, regulatory and risk analysis

Securities class action (Levi & Korsinsky)

High

Filed Mar-2026: alleges management concealed Saks bankruptcy exposure ($17.5M bad-debt) during Q3 FY26 call (Dec-2025). Class period ongoing. Base case: $20-40M settlement over 12-18 months. Tail risk: broader disclosure claims. Watch lead plaintiff deadlines and motion-to-dismiss timeline.

PVH license expiry 2027 (CK/TH)

High

Loss of ~40% of legacy revenue in ~15 months. Karl Lagerfeld + DKNY must scale to cover. Management guiding to a 15-20% revenue trough in FY28 with steady margin. Execution risk on filling the gap is the single biggest structural question.

Department-store customer concentration

Moderate

Top 3 customers historically ~40% of revenue (Macy's, Nordstrom, Dillard's). Saks bankruptcy showed the fragility. Sector under structural pressure from mass-market off-price and e-commerce. GIII partially insulated by shifting to owned DTC + international.

Tariff / supply-chain (China exposure)

Moderate

Substantial sourcing from Vietnam, China, Cambodia. New US tariff regime under 2026 administration remains fluid; management flagged $30-50M gross tariff headwind mitigated via vendor negotiation, price. Not existential but a persistent margin drag.

Wholesale channel demand (macro)

Moderate

Discretionary apparel highly cyclical; US consumer credit softening; back-to-school and holiday visibility limited. GIII's channel visibility (order book, receivables aging) is the leading indicator to monitor each quarter.

Balance sheet — deleveraged & cash-rich

Positive

$407M cash, $10.6M debt (net cash 29% of mkt cap). $400M senior notes redeemed at par 2025. No refinancing risk; ample capacity for owned-brand M&A or additional buyback. Rare position for wholesale apparel.

Founder-CEO insider buy 2026-09-14

Positive

Morris Goldfarb (CEO since 1974) bought 40,000 sh for $1.12M at $29.00. First material open-market buy in 3+ years. Historically directional signal from highest-conviction insider (founder still ~7% owner).

Beat-and-raise cadence resumed

Positive

Q1 and Q2 FY27 both beat consensus by wide margin (Q2 EPS $0.46 vs $0.23 est). Full-year guidance raised twice. Karl Lagerfeld and Vilebrequin cited as the drivers — direct execution proof on the pivot.

article

SWOT analysis

Strengths

+Net cash $396M (29% of market cap)
+Diversified brand portfolio (owned + licensed)
+Founder-CEO buying stock on open market
+Karl Lagerfeld + Vilebrequin scaling double-digit
+Debt fully retired (from $224M to $10.6M in one year)

Weaknesses

−40% of revenue from expiring PVH licenses
−Wholesale channel concentration (Macy's/Nordstrom/Dillard's)
−Operating margins structurally low (5-8%)
−Fashion-cycle inventory risk (~$700M inventory)

Opportunities

→Owned-brand mix shift → GM expansion (48-52% vs 32%)
→Additional brand M&A funded by cash pile
→Karl Lagerfeld global rollout (Asia, Middle East)
→Buyback + dividend capital return acceleration

Threats

!Levi & Korsinsky class action — litigation reserve escalation
!More department-store bankruptcies à la Saks
!Tariff regime worsens without vendor mitigation
!Consumer recession compresses discretionary apparel

article

Summary by assessment area

🟢 Financial risk — Low

Net cash 29% of market cap
Debt fully retired FY26
Positive FCF, growing cash pile
Buyback + dividend capital return

🟡 Business risk — Moderate

2027 PVH license roll-off = biggest structural question
Wholesale customer concentration
Owned-brand scaling on track but unproven at post-PVH size
Tariff / supply-chain persistent margin drag

🔴 Legal/regulatory — Elevated

Active Levi & Korsinsky securities class action
Saks bankruptcy bad-debt disclosure allegations
Estimated reserve $20-40M base case
Watch motion-to-dismiss ruling and lead plaintiff deadlines

Sources & Disclaimer

Sources: G-III Investor Relations (Q2 FY27 press release, 2026-09-02), SEC EDGAR (10-Q/Form 4 filings), Yahoo Finance / stockanalysis.com (price & market cap), Levi & Korsinsky / Bronstein Gewirtz class action filings, BTIG Research / KeyBanc analyst targets (updated 2026-09-13), Benzinga (insider buy report 2026-09-16), The Motley Fool / Seeking Alpha (earnings-call transcripts). Market data — last verified close 2026-09-18: GIII ~$32.59, market cap ~$1.37B, 52W range $24.61–$37.54, shares outstanding ~41.9M. Short interest: ~10% (est). Insider Sep-14 buy at $29.00 confirmed via Form 4. This document is for informational purposes only and does not constitute financial or investment advice.