Visibility Into ANF Margins, Sales Improves
Analysts at Jefferies & Co maintain their "buy" rating on Abercrombie & Fitch (NYSE: ANF). The target price for ANF is set to $50.
According to Jefferies & Co, Abercrombie & Fitch has reported its Q4 EPS ahead of the consensus due to better than expected gross margins. “The aggressive price promotions (AUR down 11%) in the quarter did not impact gross margins as much as some had feared,” the analysts say.
“We believe ANF is positioned for upside sales surprises based on 1) a better inventory position (-17%/ft at end of 4Q09 from -31% in 3Q09) and 2) smarter and more frequent promotions with visible event signage,” the analysts mention. “Near-term, we see stable to improving monthly comps (against easy -30%-ish comparisons) as a catalyst to drive shares higher,” the analysts add.
