Gap, Inc. (GPS) PT Raised to $32 at Wells Fargo; Solid Beat But Questions About Gap Brand

Wells Fargo raised its price target on Gap, Inc. (NYSE: GPS) to $32.00 (from $31.00) while maintaining a Market Perform rating following a solid Q4 print and outlook, driven by Old Navy. The Gap brand is in question.

Analyst Ike Boruchow commented, "So, while Old Navy appears to be one of the fastest growing apparel concepts in the US today (taking share and set to double its store growth in 2018), Gap remains a concept that has tried to turn the corner for over 2 years and now needs to dig itself out of a hole (CEO Peck compared Gap’s situation to Old Navy’s issues back in late 2015 – when comps and merch margins went squarely negative...which lasted about 2-3 quarters)."

The firm raisedFY18/FY19 estimates to $2.70/$2.84 (previously $2.52/$2.80).

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