Gap (GPS, $16.68) slashes full-year earnings forecast; announces CEO Art Peck's departure
Gap Inc. lowered its full-year earnings outlook. Additionally, it revealed that CEO Art Peck would be stepping down.
For the third quarter, the clothing retail giant’s same-store-sales declined -4%, including a -7% plunge in the Gap banner, a -3% decline in Banana Republic, and a -4% reduction in Old Navy same-store sales.
Adjusted earnings for the quarter are expected to be 50 to 52 cents, compared to the FactSet consensus estimate of 51 cents.
Gap’s latest full-year adjusted earnings guidance is in the range of $1.70 to $1.75 per share – much lower than its prior forecast of $2.05 to $2.15 per share. The FactSet consensus estimate is $1.86 per share.
CFO Teri List-Stoll cited macro impacts and slower traffic as additional headwinds to results that have been affected by “product and operating challenges across key brands”.
Separately, Gap announced that Art Peck is leaving the company. Under Peck’s leadership, the retailer planned to close more than half of its Gap-branded stores and spin off its Old Navy division into a standalone business by 2020. Peck has led the group since 2015. He will be replaced by board chairman Robert Fisher, a member of the company's founding family.
GAP in +6.57% Uptrend, advancing for three consecutive days on December 02, 2024
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where GAP advanced for three days, in of 291 cases, the price rose further within the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
GAP moved above its 50-day moving average on November 21, 2024 date and that indicates a change from a downward trend to an upward trend.
The Aroon Indicator entered an Uptrend today. In of 211 cases where GAP Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The 10-day RSI Indicator for GAP moved out of overbought territory on December 09, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 35 similar instances where the indicator moved out of overbought territory. In of the 35 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 53 cases where GAP's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
The Momentum Indicator moved below the 0 level on December 12, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on GAP as a result. In of 82 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for GAP turned negative on December 12, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 54 similar instances when the indicator turned negative. In of the 54 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GAP declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
GAP broke above its upper Bollinger Band on November 22, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (3.922) is normal, around the industry mean (3.904). P/E Ratio (20.336) is within average values for comparable stocks, (108.527). Projected Growth (PEG Ratio) (1.003) is also within normal values, averaging (1.444). Dividend Yield (0.022) settles around the average of (0.028) among similar stocks. P/S Ratio (0.688) is also within normal values, averaging (1.118).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. GAP’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. GAP’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 74, placing this stock better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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General Information
an operator of stores that retail clothing, accessories and personal care products
Industry ApparelFootwearRetail