Abercrombie: Wedbush still a buyer, but cuts target price
(CercleFinance.com) - Wedbush has reinstated its "outperform" rating on the Abercombie & Fitch share, despite cutting its target price from 16 dollars to 14 dollars, expecting the clothing chain to report Q2 EPS of -72 cents, better than the consensus of -83 cents.
The broker expects the group to announce Q2 sales that are down 13% (again better than the consensus; which forecasts a decline of 22%), along with a 200-bp deterioration in its gross margin to 57.3% (vs. a consensus of 56.2%).
"Although shares may see pressure, given a softer start for back-to-school, we continue to like the shares as the company pivots square footage rationalization and store transformation, along with a healthy balance sheet to grow the business in long term," analysts say.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The broker expects the group to announce Q2 sales that are down 13% (again better than the consensus; which forecasts a decline of 22%), along with a 200-bp deterioration in its gross margin to 57.3% (vs. a consensus of 56.2%).
"Although shares may see pressure, given a softer start for back-to-school, we continue to like the shares as the company pivots square footage rationalization and store transformation, along with a healthy balance sheet to grow the business in long term," analysts say.
Copyright (c) 2020 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.