Top picks 2012: G-III Apparel

In early December, G-III Apparel (GIII) reported quarterly earnings of $2.16 per share as year-over-year revenues rose 13.3 percent.

Earnings topped estimates of $2.14 per share, reversing a two quarter trend in which GIII missed estimates.

Additionally, the company announced an agreement with Calvin Klein to open Calvin Klein Women�s Performance stores in the U.S., China and other countries throughout the world.
GII shares responded favorably to the earnings and licensing news, which could be the catalysts for a turn-around play in the stock in 2012, following its dismal performance in the final seven months of 2011.

From a technical perspective, we view the November/December low at the 80-month moving average as a potential pivot point, a trendline that supported the stock in 2002-2003 and again in 2004-2005.

The earnings/licensing catalysts also pushed the shares back above the $22.50 area, which is half GIII�s all-time high set in April 2011 and such levels often provide strong support.

With GIII�s short interest near all-time highs after a pullback to long-term support and favorable catalysts heading into 2012, GIII is an attractive speculative play.

A short-covering rally in 2012 could rejuvenate GIII shares, which are still up by more than 500-percent over the past ten years.