Can Abercrombie & Fitch Keep the Streak Alive?

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Abercrombie & Fitch Co. (NYSE: ANF) is set to report its fiscal fourth-quarter financial results before the markets open on Wednesday. Thomson Reuters has consensus estimates of $1.10 in earnings per share (EPS) on $1.16 billion in revenue. In the same period of last year, the retailer said it had EPS of $0.75 and $1.04 billion in revenue.

Back in January, Abercrombie gave an update on its holiday quarter, as well as announcing changes to board members.

At that time, the company said that it expects to see comparable sales up high-single digits, compared to the previous outlook of up low-single digits. Net sales are expected to be up low-teens, compared to the previous outlook of up mid- to high-single digits.

Also, the company was assessing the impact of the Tax Cuts and Jobs Act of 2017 but expects to recognize a significant income tax charge in the fourth quarter, primarily related to the one-time deemed repatriation tax on accumulated foreign earnings.

Abercrombie also announced that Arthur C. Martinez would step down as executive chair of its board of directors at the end of this fiscal year (February 3, 2018). This is in connection with his plans to retire as a director and not stand for reelection at the 2018 annual meeting of shareholders in June.

Terry L. Burman, lead independent director and chair of the Nominating and Board Governance Committee was to assume the role of nonexecutive chair at that time.

Excluding Tuesday’s move, Abercrombie had outperformed the broad markets over the past year, with its stock up 69%. Year to date, the stock is up 19%.

Prior to the release of the earnings report, a few analysts weighed in on the stock:

  • B. Riley has a Neutral rating and a $22 price target.
  • Merrill Lynch has a Sell rating with a $16 price objective.
  • RBC has a Hold rating with a $24 price target.
  • Jefferies has a Hold rating.
  • Baird also has a Hold rating.
  • BMO has a Hold rating with a $22 price target.
  • Telsey Advisory has a Market Perform rating and a $24 target.
  • Argus has a Buy rating with a $25 price target.

Shares of Abercrombie were last seen up 2% at $21.12 on Tuesday, with a consensus analyst price target of $19.85 and a 52-week range of $8.81 to $23.53.

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