GAP

Gap’s stock price has taken a beating over the past six months, shedding 22.5% of its value and falling to $20.59 per share. This may have investors wondering how to approach the situation. Is there a buying opportunity in Gap, or does it present a risk to your portfolio? Get the full stock story straight from our expert analysts, it’s free. Despite the more favorable entry price, we’re sitting this one out for now. Here are three reasons we avoid GAP, plus one stock we’d rather own. Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Unfortunately, Gap struggled to consistently increase demand as its $15.4 billion of sales for the trailing 12 months was close to its revenue three years ago. This wasn’t a great result and signals it’s a lower quality business. The number of stores a retailer operates is a critical driver of how quickly company-level sales can grow. Gap operated 3,477 locations in the latest quarter, and over the last two years, has kept its store count flat while other consumer retail businesses have opted for growth. When a retailer keeps its store footprint steady, it usually means demand is stable and it’s focusing on operational efficiency to increase profitability. Growth gives us insight into a company’s long-term potential, but how capital-efficient was that growth? A company’s ROIC explains this by showing how much operating profit it makes compared to the money it has raised (debt and equity). Gap historically did a mediocre job investing in profitable growth initiatives. Its five-year average ROIC was 8.4%, somewhat low compared to the best consumer retail companies that consistently pump out 25%+. Gap’s business quality ultimately falls short of our standards. Following the recent decline, the stock trades at 8.5× forward P/E (or $20.59 per share). While this valuation is optically cheap, the potential downside is big given its shaky fundamentals. We’re fairly confident there are better investments elsewhere. Let us point you toward one of our top digital advertising picks. ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momen...

Find winning stocks in any market cycle. Join 7 million investors using Simply Wall St's investing ideas for FREE. Gap (GAP) is in focus after reporting first quarter results along with a cut to full year net sales guidance, followed by a securities law investigation that has added another layer of attention to the stock. See our latest analysis for Gap. At a share price of US$21.10, Gap’s stock has fallen 16.24% year to date, with a 90 day share price return down 8.78%. However, the three year total shareholder return is up 144.52%, pointing to long term gains but fading recent momentum as investors weigh the earnings beat against softer net sales guidance and the new securities law investigation. If Gap’s recent swings have you thinking about diversification, you can use this moment to scan a wider set of opportunities through the 19 top founder-led companies Gap now trades with a value score of 5, an implied 40% discount to an intrinsic estimate and a 31% discount to analyst targets. After guidance cuts and an investigation, is this weakness a potential opportunity based on valuation, or is future growth already fully reflected in the stock price? Gap’s most followed narrative pegs fair value at $30.65, well above the last close of $21.10. Within that framework, the stock is framed as materially discounted. Read the complete narrative. Curious what supports a fair value close to $31 when the stock trades near $21? The narrative leans on gradual revenue gains, firmer margins, and a tighter share count. The full breakdown shows how those pieces fit together to reach that number. Result: Fair Value of $30.65 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this hinges on Athleta’s reset actually gaining traction and on tariff and trade pressures not eroding the margin assumptions that are built into the narrative. Wall Street's queuing for one rocket. While SpaceX counts down to its IPO, other companies tied to the new space race are already in orbit. → 20 Compelling Space Companies watchlist · Global Space Race Investing Ideas screener · Scan the sector by valuation on Rocket Lab's valuation page. If this mix of caution and optimism around Gap has you on the fence, take a moment to review the details and form your own stance. You can start with the 3 key rewards and 2 important warning signs. Gap is jus...

Gap’s first quarter results for 2026 were met with a significant negative market reaction, as revenue came in below Wall Street’s expectations despite flat year-over-year sales. Management attributed the quarter’s mixed performance to uneven results across brands, with standout growth at Gap and continued challenges at Old Navy, particularly in seasonal categories like women’s dresses. CEO Richard Dickson acknowledged that “results at the brand level were more varied, reflecting both the different stages of their transformation and some brand specific dynamics.” Is now the time to buy GAP? Find out in our full research report (it’s free). Revenue: $3.50 billion vs analyst estimates of $3.53 billion (flat year on year, 0.8% miss) Adjusted EPS: $0.38 vs analyst estimates of $0.38 (in line) Management raised its full-year Adjusted EPS guidance to $2.35 at the midpoint, a 3.3% increase Operating Margin: 12.7%, up from 7.5% in the same quarter last year Locations: 3,477 at quarter end, down from 3,505 in the same quarter last year Same-Store Sales rose 2% year on year, in line with the same quarter last year Market Capitalization: $7.63 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Matthew Boss (JPMorgan): Asked about the timeline for Old Navy’s assortment correction and Gap’s sales momentum. CEO Richard Dickson emphasized ongoing improvements and confidence in category strength for the second half. Dana Telsey (Telsey Group): Questioned whether Old Navy’s issues were macro-driven or internal. Dickson clarified the challenges were internal, particularly with seasonal assortment, not consumer demand. Brooke Roach (Goldman Sachs): Sought insight into what led to the seasonal product missteps at Old Navy and how processes are changing. Dickson acknowledged the miss in fashion and value equation and described steps being taken to address it. Adrienne Yih-Tennant (Barclays): Inquired about the size and strategy for seasonal categories and the rollout of beauty at Old Navy. Dickson described the focus on core categories and a measured approach to beauty expansion. Mark Altschwager (Baird): Asked about the use of tarif...

In May 2026, Gap Inc. reported first-quarter sales of US$3,497 million and net income of US$339 million, while trimming its full-year sales outlook but lifting earnings guidance and completing a US$401 million share repurchase equal to 4.49% of its shares. The mixed update highlighted strong profitability alongside merchandising missteps at Old Navy, raising questions about how much execution issues at the company’s largest brand could weigh on the broader business. We’ll now examine how Gap’s lowered full-year sales guidance, driven by Old Navy’s weaker performance, affects the company’s longer-term investment narrative. Rare earth metals are an input to most high-tech devices, military and defence systems and electric vehicles. The global race is on to secure supply of these critical minerals. Beat the pack to uncover the 31 best rare earth metal stocks of the very few that mine this essential strategic resource. To own Gap today, you need to believe the multi-brand turnaround can survive setbacks at Old Navy, which still drives more than half of sales. The latest results kept profitability solid but exposed how quickly internal fashion and merchandising errors can dent the outlook. In my view, the key near term catalyst is evidence that Old Navy product fixes are gaining traction, while the biggest risk is that recurring execution issues keep sales growth stuck in low gear. In that context, Gap’s decision to trim full year net sales guidance to 1% to 2% growth while simultaneously raising earnings per share guidance to US$2.83 to US$2.93 is important. It reinforces that cost control and better margins are doing much of the heavy lifting right now, rather than broad based demand. For anyone watching the story, Q2 and Q3 Old Navy comps now look like the clearest test of whether this profit strength is truly sustainable. But beneath the improved earnings guidance, the risk that ongoing Old Navy missteps keep weighing on group sales is something investors should be aware of... Read the full narrative on Gap (it's free!) Gap’s narrative projects $16.6 billion revenue and $1.0 billion earnings by 2029. This requires 2.7% yearly revenue growth and an earnings increase of about $0.2 billion from $816.0 million today. Uncover how Gap's forecasts yield a $30.65 fair value, a 46% upside to its current price. Before this setback at Old Navy, the most optimistic analy...

Gap Inc. said it earned 38 cents a share, a penny ahead of analysts’ estimates, on revenue that rose 1% year over year to $3.5 billion, a hair below the $3.52 billion consensus. Its revenue outlook, for growth of 1% to $22, is also below its prior range of 2% to 3%. Watch our reporters discuss recent stock picks, provide their input on the current market environment—and take your questions.

Gap Inc (NYSE:GPS) shares fell more than 16% on Thursday after the apparel retailer issued a weaker-than-expected second-quarter sales outlook and trimmed its full-year revenue forecast, despite a broadly solid first-quarter performance and continued strength in its flagship Gap brand. The company reported first-quarter revenue of $3.5 billion, up 1% year over year but slightly below analyst estimates of $3.53 billion. Comparable sales rose 2%, missing the 3.1% consensus estimate, though gross margin of 40.5% exceeded the company's own outlook. Adjusted earnings per share of $0.38 came in just ahead of the $0.37 estimate. The sharp share decline was driven largely by second-quarter guidance calling for net sales to be flat to down 1% year over year, well below analyst expectations of a 2.1% gain. For the full year, Gap lowered its net sales growth forecast to 1% to 2%, from a prior outlook of 2% to 3%, while raising its adjusted EPS guidance to $2.30 to $2.40. Performance varied sharply across the company's four brands. The Gap brand posted a 10% comparable sales gain, its tenth consecutive positive quarter, driven by strength in denim and fleece. Banana Republic rose 2% and Old Navy gained just 1%, hurt by weakness in seasonal categories including dresses. Athleta fell 11% as its turnaround effort continued to lag expectations. Jefferies maintained a constructive long-term view, citing margin discipline and brand reinvigoration under CEO Richard Dickson, while lowering its price target to $29. The bank flagged early investments in beauty and artificial intelligence as potential longer-term growth drivers, but cautioned that tariffs and fuel costs remain near-term headwinds. Gap ended the quarter with $2.6 billion in cash and short-term investments and returned $464 million to shareholders. The company said it expects second-half improvement as Old Navy's seasonal challenges ease and core categories hold steady.

The Gap, Inc. GAP delivered adjusted earnings of 38 cents per share in the first quarter of fiscal 2026, down 25.5% year over year and missing the Zacks Consensus Estimate of 39 cents. Net sales of $3.50 billion rose 1% year over year but fell short of the consensus mark of $3.53 billion.Comparable sales (comps) increased 2% for the ninth straight quarter of positive comps, led by a standout performance at the Gap brand. Still, tariff-related pressure and higher spending on growth initiatives weighed on adjusted profitability.Gap’s shares fell nearly 4% in the after-hours session yesterday on soft first-quarter results and trimmed sales view for fiscal 2026. Shares of this Zacks Rank #4 (Sell) company have lost 9.1% compared with the industry’s 0.2% drop over the past six months. Results across brands were uneven, with strength concentrated in the Gap banner and more pressure in Athleta. Gap Global posted net sales of $796 million, up 10% year over year, alongside a 10% comps gain, reflecting momentum in key destination categories such as denim, fleece, and kids and baby.Old Navy Global generated $2 billion of net sales, up 1% year over year, while comps increased 1%. Banana Republic Global recorded net sales of $431 million, up 1%, with comps up 2%. Athleta remained soft, with net sales down 12% to $270 million and comparable sales down 11%. Gap brand's revenues surpassed our model's estimate of $745.3 million, while Banana Republic and Athleta brands' revenues lagged our estimates of $434.4 million and $301.1 million, respectively. Old Navy's revenues were in line with our model's estimate. The Gap, Inc. price-consensus-eps-surprise-chart | The Gap, Inc. Quote Gross margin was 40.5%, down 130 basis points from the year-ago quarter, yet management said the outcome exceeded expectations. Merchandise margin declined 100 basis points, including an anticipated net tariff impact of about 200 basis points, implying underlying improvement supported by better inventory management and strength at the Gap brand. Average unit retail rose across all brands. Adjusted operating income was $182 million and adjusted operating margin was 5.2%, down 230 basis points year over year, mainly reflecting the net tariff impacts. We had expected adjusted gross margin contraction of 150 basis points to 40.3% and adjusted operating margin decrease of 220 basis points to 5.3%.On the e...

Gap (GAP) came out with quarterly earnings of $0.38 per share, missing the Zacks Consensus Estimate of $0.39 per share. This compares to earnings of $0.51 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -2.99%. A quarter ago, it was expected that this clothing chain would post earnings of $0.45 per share when it actually produced earnings of $0.45, delivering no surprise. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Gap, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $3.5 billion for the quarter ended April 2026, missing the Zacks Consensus Estimate by 0.81%. This compares to year-ago revenues of $3.46 billion. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Gap shares have lost about 6.1% since the beginning of the year versus the S&P 500's gain of 9.9%. While Gap has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Gap was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how est...

Clothing and accessories retailer Gap (NYSE:GAP) missed Wall Street’s revenue expectations in Q1 CY2026, with sales flat year on year at $3.50 billion. Its GAAP profit of $0.90 per share was 87.6% above analysts’ consensus estimates. Is now the time to buy Gap? Find out in our full research report. Revenue: $3.50 billion vs analyst estimates of $3.53 billion (flat year on year, 0.8% miss) EPS (GAAP): $0.90 vs analyst estimates of $0.48 (87.6% beat) Operating Margin: 12.7%, up from 7.5% in the same quarter last year Free Cash Flow was $78 million, up from -$223 million in the same quarter last year Locations: 2,477 at quarter end, down from 3,505 in the same quarter last year Same-Store Sales rose 2% year on year, in line with the same quarter last year Market Capitalization: $8.79 billion "In the first quarter, Gap Inc. delivered continued progress against our strategic priorities, including further market share gains and achieving our ninth consecutive quarter of positive comparable sales," said President and Chief Executive Officer, Richard Dickson. Operating under the Gap, Old Navy, Banana Republic, and Athleta brands, Gap (NYSE:GAP) is an apparel and accessories retailer selling casual clothing to men, women, and children. Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. With $15.4 billion in revenue over the past 12 months, Gap is one of the larger companies in the consumer retail industry and benefits from a well-known brand that influences purchasing decisions. However, its scale is a double-edged sword because there are only a finite number of places to build new stores, making it harder to find incremental growth. To accelerate sales, Gap likely needs to optimize its pricing or lean into international expansion. As you can see below, Gap struggled to increase demand as its $15.4 billion of sales for the trailing 12 months was close to its revenue three years ago. This was mainly because it closed stores. This quarter, Gap’s $3.50 billion of revenue was flat year on year, falling short of Wall Street’s estimates. Looking ahead, sell-side analysts expect revenue to grow 2.8% over the next 12 months. Although this projection suggests its newer products will fuel better top-line performance, it is still below the sector a...

Image source: The Motley Fool. Thursday, May 28, 2026, at 5 p.m. ET Chief Executive Officer — Richard Dickson Chief Financial Officer — Katrina O'Connell Richard Dickson; and Chief Financial Officer, Katrina O'Connell. With that, I will turn the call over to Richard. Richard Dickson: Thanks, Whitney, and good afternoon, everyone. Before we discuss our results for the first quarter, let me begin with a moment of remembrance for our cofounder, Doris Fisher. Doris was a visionary, and an extraordinary human being whose brilliance quiet determination, and heart shaped everything from Gap Inc's indelible influence on fashion and retail to philanthropy to the San Francisco art scene. In Gap speak, she was a true original. And she worked tirelessly to ensure that Gap Inc. Always did more than sell clothes. Which inspires our purpose today. We bridge gaps to create a better world. On behalf of everyone at Gap Inc, I would like to extend our deepest condolences to the Fisher family and ensure them that the legacy Doris and Don Fisher created in Gap Inc. Will endure. Now transitioning to our results. In the first quarter, we continued to execute on our strategic priorities, delivering progress across several key metrics. Comparable sales increased 2%, marking our 9th consecutive quarter of positive comps, as we once again grew sales across all income cohorts. As the value proposition of our brands continued to resonate, we gained market share, reflecting better product, better storytelling, and building brand relevance. And we outperformed our gross margin outlook reflecting continued rigor in execution. Overall, at the company level, the quarter was in line with our expectations. However, results at the brand level were more varied, reflecting both the different stages of their transformation and some brand specific dynamics. As I reflect on the quarter, with 3 of our 4 brands once again delivering positive comps, with standout growth at the Gap brand. We continue to demonstrate progress. Yet we know some of our brands have greater potential. And we are taking action to unlock stronger performance which I will discuss in more detail. In parallel, we are also investing more intentionally in our future, as we build category adjacencies like beauty and accessories, where we see a meaningful long term growth opportunity and capabilities such as our Fashiontainment platfo...

The Gap Inc. juggernaut continues on a roll. On Thursday, Gap Inc. reported further sales gains at its three biggest brands — Old Navy, Gap and Banana Republic — along with a healthy profit increase. More from WWD Shuffle Board: PVH Revamps Leadership, Banana Republic Lands CEO Gap Inc. Names Lourdes Arocho Licensing Head Old Navy Signs Up Michael Francis, Target's Former Marketing Maestro Operating income was $445 million, up from $260 million in the year-ago period, with the operating margin last quarter at 12.7 percent. Net income was $339 million, up from $193 million in the year-ago period. Adjusted operating income was $182 million and adjusted operating margin was 5.2 percent, excluding the net impact of non-recurring items. Net sales of $3.5 billion were up 1 percent; comparable sales rose 2 percent. Merchandise margin decreased 100 basis points versus last year, inclusive of an estimated net tariff impact of approximately 200 basis points. The underlying merchandise margin expansion was primarily driven by strength at the Gap brand and improved inventory management. Average unit retail price increased across all brands. Gross margin of 40.5 percent decreased 130 basis points versus last year, exceeding the outlook. “We delivered progress. We did so across several key metrics in the quarter,” Gap Inc.’s president and chief executive officer Richard Dickson told WWD. “This was our ninth consecutive quarter of positive comp sales. Three out of the four brands are growing. Comps were up 2 percent. That’s building on 2 percent comp growth last year. We outperformed our gross margin outlook by 30 basis points. And importantly, we won across all income cohorts. So the value proposition of our products continued to resonate. And then we also returned $450 million in cash to our shareholders through dividends and share repurchases.” Asked about business in the second quarter so far, Dickson responded, “Generally speaking, the business continues to trend as expected.” Despite rising food and fuel costs and consumer confidence hitting all-time lows, “We haven’t seen any change in consumer behavior, which is good news,” Dickson said. “We’re seeing consistency and strength in that behavior. We have some sustained AUR (average unit retail price) growth and market share gains as our product continues to resonate.” The company did lower its forecast for sales for t...

Gap (GAP) reported fiscal Q1 adjusted earnings late Thursday of $0.38 per diluted share. The company