Gap hiked full-year guidance late Thursday after smashing earnings expectations for its fiscal first quarter. Gap stock soared above a buy point Friday.
Abercrombie & Fitch hiked full-year outlook early Wednesday after an easy earnings beat for its fiscal first quarter. Rival American Eagle Outfitters maintained guidance late Wednesday after also beating earnings views.
Abercrombie & Fitch stock soared into the profit-taking zone on Wednesday, but tumbled Thursday. American Eagle stock also declined.
Gap Earnings
Late Thursday, Gap delivered EPS of 41 cents for the quarter ended May 4 vs. 1 cent a year ago. Net sales increased 3% to $3.4 billion, with comparable store sales up 4% and growing at all four brands, an earnings release said.
Analysts were expecting Gap to deliver EPS of 14 cents on revenue of $3.285 billion, with same-store-sales up 1.1%.
The retailer also hiked guidance. For the full year, it now expects operating income to grow in the "mid 40%" range vs. in the "low to mid teens" previously. It now expects sales to be "up slightly" vs. "roughly flat" prior.
The company returned to growth in the previous holiday quarter, helped by the Old Navy brand.
Gap stock surged 28.6% to 28.96 in huge volume Friday, clearing the 50-day line and a 28.59 buy point. Shares rose 4% Thursday.
Abercrombie & Fitch Earnings
Estimates: Analysts expected Abercrombie & Fitch earnings to vault 352% to $1.76, according to FactSet. Revenue was seen growing 16%, year over year, to $967.4 million. Same-store sales was forecast to climb 10.2%.
Results: Abercrombie earned $2.14 a share, soaring 449% vs. a year earlier. Revenue swelled 22% to $1.02 billion, with growth accelerating for a fourth straight quarter. Same-store sales up 21%, with Abercrombie & Fitch brand comps up 29%.
Outlook: For the full fiscal year ended January 2025, Abercrombie now sees revenue up 10% vs. a prior target of 4%-6%. Analysts projected a 7% gain before the Q1 results, FactSet shows.
Abercrombie is finding favor again with middle-age shoppers nostalgic for their youth, retail market watchers say. It has also made efficiency gains.
American Eagle Outfitters Earnings
Estimates: Analysts had forecast American Eagle Outfitters earnings to jump 67% to 28 cents per share, according to FactSet. Revenue was seen growing 7%, year over year, to $1.151 billion. Same-store sales were expected to rise 5.5% vs. a decline in the year-ago quarter.
Results: American Eagle earned 34 cents a share in the quarter ended May 4 vs. 9 cents in the year-earlier quarter, or 17 cents excluding impairment charges. Revenue rose 6% to $1.1 billion. Same-store sales increased 5.5%, in line with expectations.
Outlook: For the full year, American Eagle continues to guide operating income in the range of $445 million-$465 million, on a revenue gain of 2%-4%, the company said late Wednesday.
Analysts forecast 3%, FactSet shows. American Eagle's fiscal year ends in January.
Abercrombie Stock, American Eagle Stock
Shares of Abercrombie rocketed 24.3% to 189.44 Wednesday. Shares fell 5.9% Thursday and 3.1% Friday.
On Wednesday, Abercrombie stock also hit the profit-taking sell zone from a 140.28 buy point, cleared earlier in May. Shares are now up 474% from a prior breakout last June.
The relative strength line bolted higher with the stock Tuesday. A rising RS line, the blue line in the chart shown, shows Abercrombie & Fitch stock's outperformance vs. the S&P 500 index.
Shares of American Eagle sank 7.8% Thursday . American Eagle Outfitters stock lost 1.2% Friday. Shares show a 26.44 buy point, though the RS line is near the consolidation bottom.
The apparel retailers are reporting as investors closely watch the impact of lingering inflation on consumers' shopping habits. Last week, Urban Outfitters issued strong earnings and a solid outlook for the current quarter.
Led by Abercrombie stock, the retailers went on a strong run in the past year on the back of resilient growth despite macroeconomic pressures.
