Gap Inc. (GPS - Analyst Report) registered an increase of 8% in same-store sales for the five-week period ended March 31, 2012. The company had recorded a decline of 10% in the prior-year comparable period.
Net sales in March increased 10% to $1.46 billion compared with net sales of $1.33 billion in the prior-year period. The year-over-year growth was primarily driven by solid same-store sales performances across its segments as well as a good customer response.
Same-store sales at Banana Republic North America spiked 5% year over year in contrast to a decline of 8% in the prior-year period. The company’s same-store sales at Old Navy North America grew 11% compared with a decrease of 12% in the year-ago period.
Gap North America’s same-store sales were up 9% versus a 9% fall in the prior-year period. Results at its International segment rose 2% compared with a 9% decline in the prior-year period.
Gap is scheduled to release its April same-store sales figures on May 3, 2012.
On the same day, two other Apparel store retailers Ross Stores Inc. (ROST - Analyst Report) and Nordstrom Inc. (JWN - Analyst Report) reported positive same-store sales for the month of March 2012. Comps growth at Ross was 10% in March, while Nordstrom recorded an 8.6% rise.
We believe that Gap’s long-term strategic moves along with disciplined cost management measures will not only provide financial flexibility, but will also help to drive value proposition. 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 #3 Rank, which translates into a short-term Hold rating. Our long-term recommendation on the stock remains Neutral.