Courtesy of Benzinga.
Abercrombie & Fitch (NYSE: ANF) shares are off nearly five percent after it posted disappointing second-quarter sales earlier this week and some analysts questioned its prospects.
“The number-one fear that prevents investors from owning Abercrombie is concern that the brand is becoming irrelevant,” Macquarie’s Liz Dunn said in a note Friday maintaining a Neutral rating and $45 target.
So on Thursday, Chief Executive Michael Jeffries, said the company is “looking to take the North American logo business to practically nothing.”
Although logo sales have recently fallen considerably, UBS’ Roxanne Meyer sees a downside to de-emphasizing the segment in an increasingly crowded fashion market place.
Meyer fears that “Abercrombie will become less differentiated versus other global fast fashion retailers, Meyer said in a note maintaining a Neutral rating and $40 target.
And with total U.S. denim sales down six percent last year, Meyer thinks Abercrombie’s current plan to make the category a centerpiece of its fashion lineup is “risky.”
But Oppenheimer’s Anna Andreeva maintained a Buy rating and $50 target Friday, calling Abercrombie “one of our favorite names.”
Andreeva’s modeling a same-store sales decline of three percent to four percent in the third quarter, but raised her 2015 earnings estimate to $2.35 from $2.25 a share, citing lower operating costs.
Abercrombie closed Friday at $41.80, nearly unchanged.
Posted-In: Anna AndreevaAnalyst Color Earnings News Guidance Price Target Reiteration Analyst Ratings
