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Gap (GPS) Flat As Market Gains: What You Should Know

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In the latest trading session, Gap (GPS - Free Report) closed at $12.51, marking no change from the previous day. This change lagged the S&P 500's 0.21% gain on the day. Elsewhere, the Dow gained 0.19%, while the tech-heavy Nasdaq added 0.02%.

Coming into today, shares of the clothing chain had lost 17.21% in the past month. In that same time, the Retail-Wholesale sector lost 8.18%, while the S&P 500 lost 8.08%.

Wall Street will be looking for positivity from Gap as it approaches its next earnings report date. The company is expected to report EPS of -$0.09, down 118.75% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.43 billion, down 14.13% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.27 per share and revenue of $16.07 billion. These totals would mark changes of -11.81% and -3.59%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Gap. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 33.46% lower. Gap is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, Gap currently has a Forward P/E ratio of 9.88. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 9.88.

It is also worth noting that GPS currently has a PEG ratio of 0.82. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. GPS's industry had an average PEG ratio of 0.84 as of yesterday's close.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 88, which puts it in the top 35% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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