Piper Jaffray Reiterates Neutral Rating, $28 PT on Abercrombie & Fitch

In a report published Wednesday, Piper Jaffray & Co. reiterated its Neutral rating and $28.00 price target on Abercrombie & Fitch

. Piper Jaffray noted, “We are reiterating our Neutral rating on ANF shares following the company's Q2 report this morning. In short, we think fundamental deterioration and ongoing risk to operational performance is balanced by re-engineering of the balance sheet and share repurchases. Results were largely in line with the pre-release, with minor adjustments for stores expenses, marketing and G&A. A full view into the P&L provided clarity on just how far product margins have receded, declining 750bps over the course of the last 4 years. The pricing architecture of the brands remain in flux and will be something we continue to monitor closely. The announced repurchase authorization of an additional 10M shares should help offset the deleverage, boosting earnings by $0.20-$0.25 cents in FY14. We expect management to address its operational initiatives and capital allocation decisions on the conference call this morning.” Abercrombie & Fitch closed on Tuesday at $32.33.