) soared to a new 52-week high of $42.45 on Wednesday, Jun 19,
after it reported strong comparable-store sales (comps) for the
month of May and robust first-quarter fiscal 2013 results. The
premier international specialty retailer eventually closed trade
at $41.74, reflecting a solid year-to-date return of 33.1%.
GAP INC (GPS): Free Stock Analysis Report
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Based on the current price, this global specialty apparel
retailer is 5.8% lower than the Zacks Consensus average analyst
price target of $44.32. Additionally, the company's long-term
estimated EPS growth rate is 11.8%, which is relatively healthy.
Average volume of shares traded over the last 3 months stands at
approximately 3,692K. Moreover, the stock currently trades at a
forward P/E of 15.4x, at par with the peer group average.
Gap, which has transitioned through a phase of decreasing
comparable-store sales and reduced profitability, is now set for
growth, riding on its turnaround strategies as evident from its
solid comps and sales performance so far in fiscal 2013.
Gap reported comps increase of 7% for the 4 weeks ended Jun 1,
2013 compared with a 2% rise registered for the 4 weeks ended Jun
2, 2012, driven by strong results at its namesake Gap and Old
Navy stores. Moreover, net sales totaled $1.22 billion for the 4
weeks ended Jun 1, 2013, up 11% compared with sales of $1.10
billion for the 4 weeks ended May 26, 2012.
With respect to earnings surprises, Gap has topped the Zacks
Consensus Estimate in 3 of the trailing 4 quarters with an
average surprise of 2.6%.
For the first quarter of fiscal 2013, the company's earnings of
71 cents a share soared 51.1% from the comparable prior-year
quarter and were above the Zacks Consensus Estimate of 69 cents
per share. Gap's net sales increased 6.9% year over year to
$3,729 million and surpassed the Zacks Consensus Estimate of
$3,707 million. Comps rose 2% compared with a 4% increase in the
In early June, Gap announced plans to take its global expansion
plans a notch higher with the opening of franchise and standalone
stores in Paraguay, Hungary and Mexico. Apart from this, the
company is planning to extend its international operations to 8
Latin American countries, including, Chile, Panama, Colombia,
Mexico, Uruguay, Paraguay, Peru and Brazil.
Gap has been marching ahead with its long-term plans by reducing
its dependency on the North American specialty business, while
increasing its online presence and expanding international
operations. Moreover, Gap aims to generate 30% of its total sales
from overseas operations and online business in 2013 versus 27%
in fiscal 2012.
Other stocks in the retail space that touched all-time highs on
Wednesday, Jun 19 are
), which reached $35.64, $126.99 and $193.09, respectively.