Street View: Gap shines despite Old Navy stumble
BUZZ-Street View: Gap shines despite Old Navy stumble ** Apparel retailer Gap GAP.N raised its annual profit forecast on Thursday, betting on sustained strength at its namesake brand despite ongoing pressure at some of its other labels
** Raised its annual adj. EPS forecast by 5 cents at both ends to a range of $2.35 to $2.45
** Co also named industry veteran Michael Francis as Old Navy's new CEO
** Median PT of 21 brokerages covering the stock is $27 - data compiled by LSEG
PRODUCT, MARKETING FIXES UNDERWAY
** BTIG ("buy", PT: $27) says Gap brand continues to drive the business, while Old Navy's weakness appears tied to product and marketing missteps that are already starting to improve
** Jefferies ("hold", PT: $24) says Gap's strong brand momentum and profit growth were partly offset by weakness at Old Navy, though improving August trends and new leadership could support a stronger second half
** TD Cowen ("buy", PT: $27) says Old Navy's weak quarter was not as bad as investors feared, with early signs that product, pricing and marketing fixes are helping traffic recover
** Morningstar says Gap maintained strong profitability despite weak sales at Old Navy, and believes the brand's issues are fixable through merchandising, marketing and leadership changes
(Reporting by Shania S Thomas in Bengaluru)
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