UBS Maintains a 'Neutral' on Gap, Inc. (GPS); Q2 Offers Progress, But it's Early; Valuation High

August 17, 2012 12:26 PM EDT
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Price: $23.87 -0.42%

Rating Summary:
    8 Buy, 25 Hold, 11 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 23 | Down: 34 | New: 34
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UBS maintains a 'Neutral' on Gap, Inc. (NYSE: GPS) price target of $35.00 (from $34.00).

Analyst, Roxanne Meyer's highlighted points from the Company's earning release include: 1) Slight Q2 beat; better-than-expected gross margins offset higher SG&A; 2) FY12 guidance remains below Street, but looks conservative; 3) Improved execution, but early days and stock nearing peak multiple; and 4) traffic remains negative, which is concerning in light of product/marketing improvement and SG&A will continue to grow faster than sales for the foreseeable future.

FY13 EPS estimate raised from $2.20 to $2.22 and FY14 from $2.41 to $2.44.

For an analyst ratings summary and ratings history on Gap, Inc. click here. For more ratings news on Gap, Inc. click here.

Shares of Gap, Inc. closed at $34.34 yesterday.

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