Leading apparel retail chain, Gap Inc. ( GPS ),
posted strong November comparable store sales (comps) driven by
sustained strength in its North American brands portfolio. Going
forward, the company expects to compete rigorously across as its
brands and channels as the peak holiday season approaches.GAP INC (GPS): Free Stock Analysis ReportNORDSTROM INC (JWN): Free Stock Analysis ReportROSS STORES (ROST): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment
November (four-week period ended November 24, 2012) comps at Gap
rose 3% versus a 5% decline in the comparable prior-year period.
Moreover, net sales in November summed to $1.52 billion, up 3.4%
compared with the prior-year period sales of $1.47 billion.
Comps at Gap North America increased 5% against a 2% decline
recorded in the prior-year period. Banana Republic North America's
same-store sales were up 3% versus flat comps in November last
year. Results at its Old Navy North America segment reflected a 1%
rise in comps compared with a 7% fall in the prior-year period.
Comps at the International business rose 3% for the month compared
with a 9% decline recorded in the prior-year period.
Year-to-date through November 24, 2012, the company's net sales
climbed 6% to $12.44 billion compared with $11.73 billion in the
prior-year period. Improvements in net sales were primarily driven
by 4% growth in the company's comps.
Concurrently, two of the company's competitors - Ross
Stores Inc. ( ROST ) and Nordstrom Inc. ( JWN ) -
reported same-store sales for the month of November. Ross Stores
recorded 2% growth in November comps, while comps at Nordstrom
Gap is scheduled to release its December sales results on January
We believe the company's relentless focus on turnaround strategies
for improvising the top line are paying off, which is reflected in
its solid comps and sales performance in recent months. The company
has now posted positive comps for five consecutive months (July
through November 2012).
Further, Gap's long-term strategic moves, along with disciplined
cost management measures will not only furnish it with financial
flexibility, but will also help reduce operating expenses.
Moreover, Gap's globally recognized brands complement one another,
enabling it to leverage its position in the sector.
Currently, Gap's shares maintain a Zacks #2 Rank, which translates
into a short-term Buy rating. Our long-term recommendation on the
stock remains Outperform.