Shares of clothing retailer Gap got a rating upgrade from analysts at J.P. Morgan.
J.P. Morgan analysts boosted their rating on the stock to overweight from neutral . They also hiked their price target on the shares to $30 a share from $22.
J.P. Morgan analyst Matthew Boss said, "Looking forward, we see an embedded call option on Gap/Banana Republic with zero value attributed to the two brands today," adding, "despite a potential near-term catalyst path with the Kanye West 'YZY Gap' launch in fiscal 2021 as a brand accelerator for Gap and a rotation back to workwear in light of vaccine news, a catalyst at Banana Republic, consistent with our 3-wave retail 'recovery.'"
According to Boss, Gap has underperformed the S&P 500 by 50% over the past three years, thereby supporting its upside potential.
J.P. Morgan increased its third-quarter same-store-sales estimate to -0.2%, vs. consensus estimate of -2.5%. J.P. Morgan estimates point to a third-quarter earnings of 40 cents per share vs. the consensus estimate of 31 cents.
GPS saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on April 03, 2024. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 51 instances where the indicator turned negative. In of the 51 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
The Momentum Indicator moved below the 0 level on April 04, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on GPS as a result. In of 83 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
GPS moved below its 50-day moving average on April 15, 2024 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for GPS crossed bearishly below the 50-day moving average on April 19, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GPS declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for GPS entered a downward trend on April 22, 2024. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The RSI Indicator shows that the ticker has stayed in the oversold zone for 5 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 12 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
GPS may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call 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 (3.862). P/E Ratio (20.336) is within average values for comparable stocks, (100.955). Projected Growth (PEG Ratio) (1.003) is also within normal values, averaging (1.444). Dividend Yield (0.022) settles around the average of (0.027) among similar stocks. P/S Ratio (0.688) is also within normal values, averaging (2.003).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. GPS’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating 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 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.
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. GPS’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 78, placing this stock worse than average.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
an operator of stores that retail clothing, accessories and personal care products
Industry ApparelFootwearRetail