Can Abercrombie & Fitch Recover After Recent Negative News?
With shares of Abercrombie & Fitch (NYSE:ANF) trading around $38, is ANF an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
T = Trends for a Stock’s Movement
Abercrombie & Fitch is a specialty retailer of casual apparel for men, women, and kids. Through its stores, the company is engaged in selling an array of products including casual sportswear apparel, knit and woven shirts, graphic t-shirts, fleece, jeans and woven pants, shorts, sweaters, outerwear, personal care products, and accessories for men, women, and kids under the Abercrombie & Fitch, Abercrombie Kids, and Hollister brands. Abercrombie & Fitch operates in three segments — U.S. Stores, International Stores, and Direct-to-Consumer. Trends come and go, but Abercrombie & Fitch seems to always know what its consumers want. As its brand becomes accepted internationally at an increasing rate, look for Abercrombie & Fitch to see rising profits.
On Thursday morning, Abercrombie & Fitch posted earnings and revenues that came up short on Wall Street’s expectations. The revenue miss is a negative sign to investors who seek high growth out of the company.