UPDATE: UBS Upgrades Gap, Inc. (GPS) to Buy; 'Transformation Has Many Legs'

February 4, 2014 7:07 AM EST Send to a Friend
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Price: $39.56 --0%

Rating Summary:
    10 Buy, 21 Hold, 4 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 4 | Down: 6 | New: 18
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(Updated - February 4, 2014 8:51 AM EST)

UBS upgraded Gap, Inc. (NYSE: GPS) from Neutral to Buy with a price target of $50 (from $41). Analyst Roxanne Meyer views the company as a "transformation story that has many legs."

"We look for GPS to deliver 15%+ EPS growth over the next 3 years and potentially over $5 of EPS in FY17 due to increased square footage growth and an ability to deliver positive comps from industry-leading e-commerce initiatives, outsized exposure to athletic apparel, and inflection at the core businesses. All these opportunities lead to one of the highest incremental margin stories in the industry. In our view, GPS's mix shift to higher margin businesses and supply chain initiatives are not well understood by investors. We have raised our '15 estimate well above the Street, but still see upside," said Meyer.

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 $37.25 yesterday.


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