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G-III Apparel Group Ltd. (NASDAQ:GIII), a $1.14 billion market cap apparel company currently trading at attractive valuations according to InvestingPro analysis, has entered into a material definitive agreement, according to a recent 8-K filing with the Securities and Exchange Commission. On Tuesday, the company’s Compensation Committee awarded performance share units (PSUs) to its named executive officers under the 2023 Long-Term Incentive Plan.
The PSU awards will vest based on the company’s performance against two key financial metrics over a three-year period: cumulative earnings before interest and taxes (Adjusted EBIT) and average return on invested capital (ROIC). The actual number of shares that may vest can vary and is contingent upon the company’s achievement relative to these targets. Currently, G-III maintains a healthy ROIC of 10%, while demonstrating strong financial health with an InvestingPro Overall Score of "GREAT."
Morris Goldfarb, Chairman, CEO, and Director, received the highest number of PSUs at 134,680, followed by Sammy Aaron, Vice Chairman, President, and Director, with 101,010 PSUs. Other executives, including Jeffrey Goldfarb, Dana Perlman, and Neal S. Nackman, were also recipients of PSU awards.
The vesting of 75% of each executive’s PSU award is tied to the Adjusted EBIT metric, while the remaining 25% is linked to the ROIC metric. The PSUs could increase to a maximum of 150% or decrease to a minimum of 50% of the awarded amount, depending on the company’s performance against the set targets. No vesting will occur if performance falls below the minimum threshold.
Settlement of vested PSUs is scheduled to occur on or within 90 days after April 1, 2028, provided the executives remain employed by G-III Apparel through the vesting date. Adjustments to the number of shares related to the PSU awards will be made in case of stock splits, stock dividends, or other significant corporate events. The company’s management has shown confidence in its future prospects through aggressive share buybacks, one of several positive indicators identified by InvestingPro analysts, who currently see the stock as undervalued based on their Fair Value calculations.
The details of the PSU awards are outlined in the form of Performance Share Unit Agreement, which is included as an exhibit in the 8-K filing. This strategic move aligns executive compensation with company performance, incentivizing leadership to drive financial success over the coming years. The information in this article is based on the press release statement from G-III Apparel Group Ltd.
In other recent news, G-III Apparel Group Ltd reported robust financial results for the fourth quarter of 2025, exceeding both earnings and revenue expectations. The company posted an earnings per share (EPS) of $1.27, surpassing the projected $0.96, and achieved a revenue of $839.5 million, which was higher than the anticipated $808.59 million. This performance marks a 10% increase in revenue year-over-year, driven by strong sales in owned brands such as DKNY and Donna Karan. KeyBanc Capital Markets maintained its Overweight rating on G-III Apparel, with a price target of $40, reflecting optimism about the company’s potential for margin expansion and earnings growth.
Additionally, G-III Apparel launched four new brands and expanded its licensing agreements, contributing to its strong quarterly performance. The company’s gross margin expanded to 40.8% from 40.1%, while inventory levels decreased by 8% to $478 million, indicating efficient inventory management. Looking ahead, G-III Apparel projects a slight revenue decline for fiscal 2026 but expects stable EPS, with key owned brands anticipated to grow in double digits. The company is also focusing on mitigating the impacts of China tariffs, which it expects to manage effectively through strategic negotiations.
Analyst Ashley Owens from KeyBanc praised G-III Apparel’s strategic focus on owned brands and its ability to outperform in a challenging macroeconomic environment. The company’s strategy and execution have been highlighted as key factors in its success, with expectations of continued growth and margin expansion in the current fiscal year.
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