Gap Rating Lowered to Market Perform at BMO Capital Markets (GPS)
Gap (NYSE:GPS) was downgraded by equities research analysts at BMO Capital Markets from an “outperform” rating to a “market perform” rating in a research note issued to investors on Tuesday, TheFlyOnTheWall.com reports. They currently have a $35.00 price target on the stock, down from their previous price target of $50.00. BMO Capital Markets’ price target would indicate a potential downside of 5.23% from the stock’s previous close.
The analysts wrote, “We are lowering our rating on Gap to Market Perform from Outperform. We have growing concerns that sector-wide 3Q weakness may extend into 4Q, given soft consumer demand, elevated inventory, and an increasingly promotional environment, based on our field research. We see many factors as driving this weakness, including the lack of a clear fashion consensus and an anemic macro backdrop. Please see our Apparel Retail sector report, dated 10/21/13, for details. We do not believe Gap has been immune to this broader slowdown. Further, with Gap’s design team in transition, mixed reviews on Fall and Holiday product from our channel checks, and enhanced marketing efforts, we believe struggling to drive higher traffic, we see risk to margins. The SRI has shown a step-up in promotions at the core Gap brand.”
Shares of Gap (NYSE:GPS) traded down 1.03% during mid-day trading on Tuesday, hitting $36.55. The stock had a trading volume of 6,110,177 shares. Gap has a 52 week low of $29.84 and a 52 week high of $46.56. The stock’s 50-day moving average is $40.06 and its 200-day moving average is $41.11. The company has a market cap of $17.087 billion and a price-to-earnings ratio of 13.61.
Gap (NYSE:GPS) last released its earnings data on Thursday, August 22nd. The company reported $0.64 earnings per share for the quarter, meeting the analysts’ consensus estimate of $0.64. The company had revenue of $3.87 billion for the quarter, compared to the consensus estimate of $3.83 billion. During the same quarter last year, the company posted $0.49 earnings per share. Gap’s revenue was up 8.1% compared to the same quarter last year. Analysts expect that Gap will post $2.72 EPS for the current fiscal year.
In other Gap news, Insider Stefan Larsson unloaded 24,688 shares of Gap stock on the open market in a transaction that occurred on Friday, October 18th. The shares were sold at an average price of $36.77, for a total value of $907,777.76. The sale was disclosed in a filing with the SEC, which is available at this link.
Other equities research analysts have also recently issued reports about the stock. Analysts at UBS AG cut their price target on shares of Gap from $45.00 to $41.00 in a research note to investors on Friday, October 11th. They now have a “neutral” rating on the stock. Separately, analysts at Sterne Agee cut their price target on shares of Gap from $38.00 to $36.00 in a research note to investors on Friday, October 11th. They now have an “underperform” rating on the stock. Finally, analysts at Nomura reiterated a “neutral” rating on shares of Gap in a research note to investors on Friday, October 11th. They now have a $40.00 price target on the stock, down previously from $42.00. Two investment analysts have rated the stock with a sell rating, sixteen have given a hold rating and ten have assigned a buy rating to the company. The company has a consensus rating of “Hold” and an average target price of $44.59.
The Gap, Inc (NYSE:GPS) is a global specialty apparel company.
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