UBS Remains Sidelined on Abercrombie & Fitch (ANF) Following 2Q - PT to $18

UBS maintained a Neutral rating on Abercrombie & Fitch (NYSE: ANF), and cut the price target to $18.00 (from $22.00), following the company's 2Q earnings report. UBS lowered FY16 EPS estimates to 0.67 (from $0.74), compared to the Street's $0.80. The cut is based on SSS.

Analyst Michael Binetti commented, "Traffic issues continued to weigh on ANF's business in 2Q and are expected to continue for the rest of the year. ANF's high international mix (~35% of the biz) remains a key overhang given FX pressures (expected to accelerate in 3Q) and weakness at A&F International (given higher tourist/flagship exposure). ANF has lowered the bar on FY16 as guidance now assumes SSS to remain challenging (previously expected 2H to improve) and flat gross margins with 3Q down due to FX (previously expected to be slightly up), but we didn't hear a clear diagnosis of the 3Q product issues or signals of an accelerated improvement timeframe. We're lowering our EPS estimates and trimming our PT to $18 (from $22). Maintain Neutral rating."

For an analyst ratings summary and ratings history on Abercrombie & Fitch click here. For more ratings news on Abercrombie & Fitch click here.

Shares of Abercrombie & Fitch closed at $18.29 yesterday.

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