Gap: third-quarter profit beats expectations as sales resist
(CercleFinance.com) - US fashion retailer Gap reported higher-than-expected quarterly profit late on Tuesday, helped by a rise in sales at its Banana Republic and Old Navy chains.
The San Francisco-based company announced that its net income rose to 266 million dollars, or 69 cents per share, for the third quarter ended 3 November, from 229 million, or 59 cents per share, a year earlier.
Total sales rose 7% to 4.1 billion dollars, with comparable sales flat. Comparable sales grew by 4% at Old Navy, and rose by 2% at Banana Republic.
"Third-quarter results showed us that Old Navy is a machine, Athleta is a major long-term growth vehicle, Banana is in great cyclical shape, and the Gap brand's footprint issues are being addressed aggressive," analysts at Jefferies said.
The broker said it remains a buyer of the shares, seeing upside potential of 50% to its target price of 50 dollars, while the current share price is around 25 dollars.
Gap narrowed its full-year earnings estimate range to 2.55 dollars to 2.60 dollars per share, compared with a previous guidance of 2.55 dollars to 2.70 dollars.
The shares are currently up 4.8% at 25.9 dollars.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The San Francisco-based company announced that its net income rose to 266 million dollars, or 69 cents per share, for the third quarter ended 3 November, from 229 million, or 59 cents per share, a year earlier.
Total sales rose 7% to 4.1 billion dollars, with comparable sales flat. Comparable sales grew by 4% at Old Navy, and rose by 2% at Banana Republic.
"Third-quarter results showed us that Old Navy is a machine, Athleta is a major long-term growth vehicle, Banana is in great cyclical shape, and the Gap brand's footprint issues are being addressed aggressive," analysts at Jefferies said.
The broker said it remains a buyer of the shares, seeing upside potential of 50% to its target price of 50 dollars, while the current share price is around 25 dollars.
Gap narrowed its full-year earnings estimate range to 2.55 dollars to 2.60 dollars per share, compared with a previous guidance of 2.55 dollars to 2.70 dollars.
The shares are currently up 4.8% at 25.9 dollars.
Copyright (c) 2018 CercleFinance.com. All rights reserved.