Paul Lejuez, an analyst from Citi, maintained the Hold rating on Abercrombie Fitch (ANF – Research Report). The associated price target was raised to $100.00.
Paul Lejuez has given his Hold rating due to a combination of factors reflecting Abercrombie & Fitch’s recent performance and market expectations. The company has demonstrated strength in its Abercrombie brand and growth in Hollister, leading to raised fourth-quarter sales and EBIT margin forecasts. This positive momentum and the management’s confidence in maintaining comparable sales growth into 2024 suggest a solid business trajectory. Furthermore, Abercrombie & Fitch’s unique “test, react, and chase” model is highlighted as a key differentiator that contributes to inventory discipline and is expected to support future growth. Despite these positive indicators, the stock has already seen substantial appreciation, which suggests that the current valuation may adequately reflect the company’s prospects, leading to a balanced risk/reward scenario at the present share price levels.
In alignment with the updated guidance and stronger financials, Lejuez has adjusted his earnings estimates upward for fiscal years 2023 and 2024. Additionally, he has increased the target price from $82 to $100, which is supported by a higher estimated terminal multiple in the discounted cash flow analysis. This adjustment reflects the consistent strength and improved margin profile of Abercrombie & Fitch. However, the modest expected share price return of 3.9% and the significant run-up in the stock price contribute to the rationale for the Hold rating, as the stock may now offer limited upside potential in the near term.
In another report released on January 5, UBS also maintained a Hold rating on the stock with a $93.00 price target.
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Abercrombie Fitch (ANF) Company Description:
Abercrombie & Fitch Co. engages in the retail of apparel, personal care products and accessories. It offers apparel products, including knit tops, woven shirts, graphic t-shirts, fleece, sweaters, jeans, woven pants, shorts, outerwear, dresses, intimates and swimwear; and personal care products and accessories for men, women and kids under the Abercrombie & Fitch, abercrombie kids, Hollister and Gilly Hicks brands. The company was founded by David Abercrombie in 1892 and is headquartered in New Albany, OH.
Read More on ANF:
- Abercrombie & Fitch (NYSE:ANF) Gains on Upbeat Outlook
- Abercrombie & Fitch stock goes from rags to riches, Barron’s says
- Abercrombie & Fitch price target raised to $93 from $75 at UBS
- Abercrombie & Fitch price target raised to $99 from $74 at JPMorgan
- Abercrombie & Fitch put volume heavy and directionally bearish
