Abercrombie & Fitch (ANF) PT Raised to $105 at Citi

Citi analyst Paul Lejeuz raised the price target on Abercrombie & Fitch (NYSE: ANF) to $105.00 (from $98.00) while maintaining a Buy rating.

The analyst comments "1Q EPS of $1.59 beat cons driven by stronger sales, while GM was weaker than cons (higher A&F promos). Shares traded +15% after mgmt guided F25 EPS to $9.50-10.50 (bears were pricing in $7-8) and 2Q sales were guided above mkt expectations to +3-5%. A&F 1Q comps -10% were below mgmt plan, and 2Q will see cont’d GM pressure from higher A&F inventory. F25 guidance assumes A&F sales return to growth at some point in 2H and GM pressure from higher inventories abate, while Hollister trends/AURs expected to remain solid (though decel vs 1H). While skepticism remains around improving 2H A&F trends/AURs, we believe ANF has flexibility to protect margin downside (SG&A well controlled in 1Q, and strength at Hollister helping to offset pressure at A&F). ANF’s cash position is ~15% of mkt cap even after repo of $200MM (5% of shares) in 1Q. We see a favorable risk/reward."

You May Also Be Interested In

• Bernstein SocGen Group Starts Terawulf Inc. (WULF) at Outperform
• Goldman Sachs Upgrades Plains GP Holdings, L.P (PAGP) to Neutral
• Dover Corp. (DOV) PT Raised to $230 at Morgan Stanley