Gap Is Still Hooked To Mall Traffic Headwinds

Gap Inc

GPS

is still hooked to mall traffic headwinds in May though sales for the month was better than feared, according to the Buckingham Research Group analyst, Kelly Halsor. However, the traffic was in-line with overall mall traffic. The analyst reiterated his Neutral rating and $18 price target, which implied 2percent downside risks after the retailer reported its monthly sales number. The brokerage thinks that GPS is among several retailers to call out enhancing trends in the last week of May, indicating that weather was the biggest factor driving the weakness in retail in the April/May time period and with warm weather in the Northeast likely here to stay, traffic trends have the potential to improve in June and July. Halsor said, "However, with GPS' traffic down HSD again in May, in-line with overall mall traffic despite the solid end to the month, GPS' comps appear to be beholden to volatile mall traffic with few tools in its belt to fight back (price, fashion, etc), leaving very little visibility into comp trends and/or EPS upside from here." The brokerage expects GPS shares and the broader retail group to trade higher on short covering following the more upbeat news around late May trends. Halso added, "we view the positive news as somewhat fleeting without more visibility into EPS upside from here, and as such, we are cautious on GPS shares and mall-based apparel retailers overall on any move higher, particularly as we look toward the less meaningful summer months ahead for retail." Shares of the company traded 4.42 percent higher on Friday.

Posted In: News Price Target Reiteration Analyst Ratings

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.

QQQ

DIA

SPY

TLT

GLD

BTC/USD

QQQ

DIA

SPY

TLT

GLD

BTC/USD

Gap Is Still Hooked To Mall Traffic Headwinds