KeyBanc Reiterates a Buy Rating on Gap

By Austin Angelo

In a report released today, Edward Yruma from KeyBanc reiterated a Buy rating on Gap (NYSE: GPS), with a price target of $33. The company’s shares opened today at $27.28.

Yruma commented:

“We think that Gap continues to make progress in its turnaround, and the stock is compelling heading into the Holiday season. Our April 4 upgrade to Overweight was predicated on a combination of better product and process. We think that October’s -1% comp (+2% comp, ex. Fishkill per GPS) demonstrates continued progress. Our upwardly revised 9.1% 2016 EBIT margin still remains well below 2012’s 12.4% margin and provides a potential marker for a medium- term outcome.”

According to, Yruma is a 3-star analyst with an average return of 1.3% and a 51.0% success rate. Yruma covers the Services sector, focusing on stocks such as Ascena Retail Group, New York & Company, and The Bon-Ton Stores.

Currently, the analyst consensus on Gap is Hold and the average price target is $21.50, representing a -21.2% downside.

In a report released today, Jefferies also reiterated a Buy rating on the stock with a $32 price target.

Based on Gap’s latest earnings report from January 31, the company posted quarterly revenue of $4.39B and quarterly net profit of $214M. In comparison, last year the company earned revenue of $3.86B and had a net profit of $248M.

Based on the recent corporate insider activity of 41 insiders, corporate insider sentiment is neutral on the stock. Most recently, in March 2016, Solomon Goldfarb, the EVP, Digital & Customer Exp. of GPS sold 1,122 shares for a total of $33,144.

Gap, Inc. operates as a global apparel retail company. It offers apparel, accessories, and personal care products for men, women, and children under the Gap, Banana Republic, Old Navy, Athleta, and Intermix brands. It operates through the following segments: Gap Global, Old Navy Global, Banana Republic Global, Athleta, and Intermix. The Gap Global segment includes apparel and accessories for men and women under the Gap brand, along with the GapKids, BabyGap, GapMaternity, GapBody, and GapFit collections. The Old Navy Global segment offers clothing and accessories for adults and children. The Banana Republic Global segment provides clothing, eyewear, jewelry, shoes, handbags, and fragrances. The Athleta segment offers fitness apparel for women. The Intermix segment features styles from various designers. The company was founded by Donald G. Fisher and Doris F. Fisher in July 1969 and is headquartered in San Francisco, CA.