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Abercrombie & Fitch (ANF) Gains But Lags Market: What You Should Know


Abercrombie & Fitch (ANF) closed at $20.94 in the latest trading session, marking a +0.1% move from the prior day. This change lagged the S&P 500′s 0.97% gain on the day. At the same time, the Dow added 1.09%, and the tech-heavy Nasdaq gained 1.08%.

Heading into today, shares of the teen clothing retailer had gained 9.7% over the past month, outpacing the Retail-Wholesale sector’s loss of 1.47% and the S&P 500′s loss of 3.04% in that time.

Investors will be hoping for strength from ANF as it approaches its next earnings release, which is expected to be March 6, 2019. In that report, analysts expect ANF to post earnings of $1.10 per share. This would mark a year-over-year decline of 20.29%. Meanwhile, our latest consensus estimate is calling for revenue of $1.14 billion, down 4.55% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.92 per share and revenue of $3.57 billion. These totals would mark changes of +41.54% and +2.23%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for ANF. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.09% higher. ANF is currently sporting a Zacks Rank of #1 (Strong Buy).

Valuation is also important, so investors should note that ANF has a Forward P/E ratio of 22.63 right now. Its industry sports an average Forward P/E of 13.5, so we one might conclude that ANF is trading at a premium comparatively.

Meanwhile, ANF’s PEG ratio is currently 1.81. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Retail – Apparel and Shoes stocks are, on average, holding a PEG ratio of 1.39 based on yesterday’s closing prices.

The Retail – Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 59, which puts it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ANF in the coming trading sessions, be sure to utilize Zacks.com.

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