Clothing retailer Gap (GAP) has reported Fiscal third-quarter financial results that beat Wall Street forecasts on the top and bottom lines.
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The San Francisco-based company announced earnings per share (EPS) of $0.62, which was ahead of the $0.59 consensus expectation of analysts. Revenue of $3.94 billion topped the $3.91 billion that was forecast on Wall Street.
Management said its sales and profits got a boost in Q3 from its viral “Better in Denim” marketing campaign that featured popular girl group Katseye. Executives at the Gap said the 5% rise in comparable sales in Q3 was the strongest for the Gap since its 2017 holiday quarter.
Gap’s Guidance
In terms of guidance, the Gap said it now expects its full-year sales to be at the high end of its previous forecast that calls for 1.7% to 2% growth, which is in line with analyst consensus expectations. The company is also expecting its full-year operating margin to be around 7.2%.
Comparable sales at the Gap, which also owns the banners Old Navy, Athleta and Banana Republic, have been positive for seven consecutive quarters. The company is focused on boosting profitability and fixing operations as it strives for cultural relevance.
Is GAP Stock a Buy?
GAP stock has a consensus Moderate Buy rating among 14 Wall Street analysts. That rating is based on eight Buy and six Hold recommendations issued in the last three months. The average GAP price target of $26.64 implies 11.70% upside from current levels. These ratings could change after the company’s financial results.
