Guess Stock (NYSE: GES) has dropped 35% so far in 2025, significantly underperforming the S&P 500’s 8% decline. This underperformance is largely attributed to difficulties in its Americas segment, elevated inventory levels, and aggressive discounting—all of which have hurt profitability. Broader market volatility, driven by tariff measures under the Trump administration and rising trade tensions, has further pressured the stock. Although the company’s acquisition of Rag & Bone is supporting revenue growth, profits took a significant hit in the holiday quarter.
Guess is reevaluating its strategy in China, shifting from direct operations toward a potential partnership with an established local company. In North America, the company plans to shutter roughly 20 underperforming stores as part of an effort to reduce its retail footprint amid declining foot traffic.
Despite currently trading at around $10, Guess stock appears fundamentally unattractive. While the low valuation might seem appealing, a closer look reveals multiple red flags. Our assessment, based on key indicators across Growth, Profitability, Financial Stability, and Downturn Resilience, indicates that the stock remains a poor investment choice at this time.
How does Guess’ valuation compare to the S&P 500?
Looking at the price paid per dollar of sales or profit, GES stock appears cheap relative to the broader market.
• Guess? has a price-to-sales (P/S) ratio of 0.2 versus 2.8 for the S&P 500
How has Guess revenue grown in recent years?
Guess Revenues have seen modest growth in recent years.
• Guess? has achieved an average annual growth rate of 4.9% over the last three years (compared to 6.2% for the S&P 500)
• Over the last 12 months, revenue increased 7.9% from $2.8 billion to $3.0 billion (vs. 5.3% growth for the S&P 500)
• Most recently, quarterly revenue rose 4.6% to $932 million from $891 million a year earlier (vs. 4.9% increase for the S&P 500)
How profitable is Guess?
Guess’ margins are significantly lower than average across the Trefis coverage universe.
• Guess’s Operating Income for the last four quarters totaled $174 million, reflecting a low Operating Margin of 6.0%(vs. 13.1% for the S&P 500)
Is Guess financially stable?
The company’s balance sheet is underwhelming.
• At the end of the most recent quarter, Guess reported $1.5 billion in debt versus a market cap of $501 million (as of 4/15/2025), implying a very high Debt-to-Equity Ratio of 278.0% (vs. 21.5% for the S&P 500)
• The company holds $188 million in cash and equivalents out of $2.8 billion in total assets, resulting in a moderate Cash-to-Assets Ratio of 5.0% (vs. 15.0% for the S&P 500)
How does GES perform during downturns?
GES stock has underperformed significantly during recent market downturns. With uncertainty surrounding a soft landing, it’s worth considering how severe losses could be if another recession hits. The Trefis dashboard How Low Can Stocks Go During A Market Crash illustrates how major stocks fared in the last six market crashes.
Inflation Shock (2022)
• GES stock declined 53.1% from a high of $30.79 on May 27, 2021 to $14.43 on September 26, 2022, versus a 25.4%drop in the S&P 500
• The stock fully recovered to its pre-crisis high by March 21, 2024
• It later reached a high of $33.40 on April 1, 2024 and now trades around $10
Covid Pandemic (2020)
• GES stock dropped 83.3% from a peak of $23.50 on January 17, 2020 to $3.92 on March 18, 2020, while the S&P 500 fell 33.9%
• The stock fully recovered by January 8, 2021
Bringing it all together: What this means for GES stock
Summarizing Guess’ performance on key indicators:
• Growth: Weak
• Profitability: Very Weak
• Financial Stability: Very Weak
• Downturn Resilience: Extremely Weak
• Overall: Very Weak
Despite its low valuation, we believe the stock remains unattractive, reinforcing our view that GES is a poor investment choice.
While it may be wise to steer clear of GES stock for now, consider exploring the Trefis Reinforced Value Portfolio, which has consistently outperformed its all-cap benchmark (including the S&P 500, S&P MidCap, and Russell 2000 indices). Why? The quarterly rebalanced mix of large-, mid-, and small-cap RV Portfolio holdings offers a responsive strategy that benefits from positive market trends while cushioning downside risk, as seen in the RV Portfolio performance metrics.
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