Wall Street’s outlook for Gap and its peers
Gap (GPS) is covered by 25 Wall Street analysts, who jointly rate the stock a 3 on a scale of 1 for “strong buy” to 5 for “sell.” The company is among the lower-rated apparel retailers. In comparison, Guess (GES), Urban Outfitters (URBN), and American Eagle Outfitters (AEO) are rated 2.6, 2.5, and 2.4, respectively.
Gap has more “hold” ratings than its peers. GES, URBN, and AEO have “hold” recommendations from 60%, 47%, and 55% of analysts, respectively.
About 80 of the analysts covering Gap are recommending a “hold” for the stock. They include Oppenheimer, Credit Suisse, and JPMorgan.
About 8% of the remaining analysts, including Telsey Advisory, are suggesting a “buy,” and 12% are recommending a “sell.” Gap was upgraded by Telsey Advisory to “outperform” from “market perform” on March 15.
Gap is currently trading at $31.57, which is 13% below its 52-week high. It has been assigned an average target price of $34.03, which indicates an upside of 8% over the next 12 months.
In comparison, GES, URBN, and AEO have downsides to their current stock prices. Their stocks are expected to fall 23%, 5%, and 7%, respectively, over the next 12 months.
ETF investors seeking to add exposure to Gap can consider the iShares Edge MSCI Multifactor Consumer Discretionary ETF (CNDF), which invests 2.2% of its portfolio in Gap.