Goldman Sachs reports that Gap, Inc.'s GPS 3Q EPS of $0.48 “was essentially in-line with our estimate and the preannounced $0.47-0.48.”
As reported, total sales were +2% with comps flat. “SG&A reductions offset softer than expected gross margin (merchandise margin down 180 bps),” Goldman Sachs writes. “Inventory/ft +9% is still trending higher than sales, but the spread is not quite as wide as it appears on the surface (thanks to closing underproductive space, GPS' sales/ft is actually +4% despite comp sales being flat).”
Goldman Sachs is maintaining its 2010E EPS, but raise 2011/12E on lower SG&A and some incremental repurchase (to $1.83/1.87 from $1.72/1.76). Based on higher earnings, “we raise our 6-month, multiple-based target to $19 from $18.”
Gap currently trades at $20.91.
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
---|
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in