ANF Continues To Be A Long Term Buy

Analysts at Goldman Sachs reiterate their "buy" rating on Abercrombie & Fitch ANF, while reducing their estimates for the company. The target price for ANF is set to $54. Although Abercrombie & Fitch met expectations for the quarter, the shares sold off on “sector pressure and concerns such as inflation, sales trends, and FX.” The analysts “expect choppy results and trading headwinds for ANF and broader apparel retail sector for the next couple of months.” However, Goldman continues to believe in Abercrombie & Fitch because “1) ANF offers both accretive international growth and domestic turnaround potential…2) ANF saw a sharp improvement in comp-store unit trends in 1Q (up approx 17%) as it learned to promote to drive sales….3) ANF’s EUR exposure is small (around 15% of international sales, 2% of total sales) and ANF’s overall currency basket is only down about 6% from December’s peak.” Goldman Sachs has lowered its EPS estimates for 2010, 2011 and 2012 from $1.99 to $1.79, from $3.00 to $2.92 and from $4.26 to $4.18, respectively, due to “modestly lower sales and gross margin.” More Analyst Ratings here