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Shares of Abercrombie & Fitch (ANF) Pop on Takeover Interest
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On Wednesday, shares of iconic American teen retailer Abercrombie & Fitch (ANF - Free Report) are popping, up about 9% in morning trading after Reuters reported that the company is considering putting itself up for sale. ANF stock soared upwards of 13% in premarket trading on the news.
Reuters, who cited people familiar with the situation, said Abercrombie has hired investment bank Perella Weinberg Partners to field potential takeover interest. However, there is no certainty that any deal will occur, the sources added.
Based in New Albany, Ohio, Abercrombie was once a fashion staple for teens in the U.S., known for its popular denim and logo-stamped t-shirts and sweaters. But the rise of fast-fashion powerhouses like Forever 21, H&M, and Zara proved too much for Abercrombie, swiftly stealing its core customer base, including those of its mall peers like American Eagle Outfitters (AEO - Free Report) , Aeropostale , and Wet Seal.
Business-wise, Abercrombie’s shares are currently trading at a 17-year low, which will either make it a great value buy or an incredibly volatile acquisition, depending on your view of the retail industry. Abercrombie’s operating income has shrunk to $15.2 million last year from $72.8 million in 2015, though the company has been trying to revamp its brand image and win back customers.
The retailer has been redesigning its stores, recognizable for their nightclub vibe, to be much brighter. Product-wise, Abercrombie’s clothing has relied less heavily on their famous logo because of teenagers’ shifting preferences. And while its namesake brand has been struggling, Abercrombie’s surfwear-inspired brand Hollister has been doing well, and has reported two years of flat same-store sales performance.
As of the end of January, the company currently operates 709 stores throughout the country and 189 stores outside the U.S. Abercrombie, however, has plans to close 60 U.S. stores, a decision that came in March after its disappointing fourth quarter earnings report saw same-store sales drop 13%.
Abercrombie reports its next quarterly earnings on May 25.
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Shares of Abercrombie & Fitch (ANF) Pop on Takeover Interest
On Wednesday, shares of iconic American teen retailer Abercrombie & Fitch (ANF - Free Report) are popping, up about 9% in morning trading after Reuters reported that the company is considering putting itself up for sale. ANF stock soared upwards of 13% in premarket trading on the news.
Reuters, who cited people familiar with the situation, said Abercrombie has hired investment bank Perella Weinberg Partners to field potential takeover interest. However, there is no certainty that any deal will occur, the sources added.
Based in New Albany, Ohio, Abercrombie was once a fashion staple for teens in the U.S., known for its popular denim and logo-stamped t-shirts and sweaters. But the rise of fast-fashion powerhouses like Forever 21, H&M, and Zara proved too much for Abercrombie, swiftly stealing its core customer base, including those of its mall peers like American Eagle Outfitters (AEO - Free Report) , Aeropostale , and Wet Seal.
Business-wise, Abercrombie’s shares are currently trading at a 17-year low, which will either make it a great value buy or an incredibly volatile acquisition, depending on your view of the retail industry. Abercrombie’s operating income has shrunk to $15.2 million last year from $72.8 million in 2015, though the company has been trying to revamp its brand image and win back customers.
The retailer has been redesigning its stores, recognizable for their nightclub vibe, to be much brighter. Product-wise, Abercrombie’s clothing has relied less heavily on their famous logo because of teenagers’ shifting preferences. And while its namesake brand has been struggling, Abercrombie’s surfwear-inspired brand Hollister has been doing well, and has reported two years of flat same-store sales performance.
As of the end of January, the company currently operates 709 stores throughout the country and 189 stores outside the U.S. Abercrombie, however, has plans to close 60 U.S. stores, a decision that came in March after its disappointing fourth quarter earnings report saw same-store sales drop 13%.
Abercrombie reports its next quarterly earnings on May 25.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9x stock explosion after they launched their iPhone in 2007? Now, 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade, which could, in turn, save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>