Abercrombie & Fitch (ANF) PT Lowered to $90 at Raymond James

Raymond James analyst Rick Patel lowered the price target on Abercrombie & Fitch (NYSE: ANF) to $90.00 (from $110.00) while maintaining a Outperform rating.

The analyst comments "We preview F1Q25 earnings and lower estimates to reflect 1) channel checks that show lingering softness at A&F brand and 2) tariffs. Our checks include store traffic, mobile app data, Google Trends, and our weekly online promotions. The A&F brand showed q/q slowing across most checks and promotions were higher for much of 1Q. Hollister was better across most checks, and we still anticipate robust growth this year. For tariffs, we estimate ANF faces unmitigated annualized tariff headwinds of ~200bp. Its mitigation strategies should be similar to others in Softlines (sharing costs with manufacturers, optimizing sourcing, selectively raising price). We don’t have high confidence in ANF’s ability to hike prices given it targets younger consumers, and we accordingly revise GM% estimates down on tariffs (and more promos). Despite the slowing, ANF is -52% YTD and its P/E is ~6.5x (5-year average is 14x). We view much of the bad news as baked in and still see LT levers for growth and margin expansion, suggesting LT risk/reward skews attractive, which keeps us at an Outperform rating."

You May Also Be Interested In

• Bernstein SocGen Group Starts Terawulf Inc. (WULF) at Outperform
• Tilly's, Inc. (TLYS) Tops Q1 EPS by 44c ; offer guidance
• BTIG Upgrades Medtronic, Inc. (MDT) to Buy