Here’s what triggered Guess’s sell-off yesterday
Shares of Guess (GES) fell ~18% on February 1, 2018, after model and actress Kate Upton accused the company’s cofounder, Paul Marciano, of sexually and emotionally harassing women. Upton used the hashtag #metoo to indicate that she’d also been a victim.
“It’s disappointing that such an iconic women’s brand @Guess is still empowering Paul Marciano as their creative director #metoo,” said Upton in her tweet on January 31.
She then posted the screenshot of the tweet on her Instagram page and wrote, “He shouldn’t be allowed to use his power in the industry to sexually and emotionally harass women #metoo.”
The #MeToo hashtag has been increasingly used by women since October 2017 to share their experiences of sexual misconduct, especially in the workplace.
What’s Marciano’s response to the acquisitions?
Marciano, who is currently Guess’s chief creative officer, dismissed Upton’s claims in an interview with celebrity news website TMZ. He said, “If she has a claim, there’s one place to tell the truth and that’s in court or to the police.”
Marciano claimed that the company’s decision to break ties with Upton was probably the motivation behind the allegations. Marciano, along with his brothers, founded Guess in 1981.
Where’s Guess stock sitting right now?
Upton’s tweet triggered a massive slide in GES stock and washed away the company’s YTD (year-to-date) returns. The stock fell 17.7% to $15.11 on February 1. and it’s currently sitting at a YTD fall of 10.5%.
ETF investors looking to add exposure to Guess can consider the First Trust Dow Jones Global Select Dividend Index Fund (FGD), which invests 1.6% of its portfolio in the company.