The Gap, Inc. (GAP) - What Are Investment Firms Thinking About This Stock?

Key Points

• Analysts remain cautious on GAP: Twenty-one brokerages give the stock a consensus “Hold” rating, with five Buys, two Strong Buys, thirteen Holds and one Sell. The average 12-month price target is $27.07.
• Quarterly earnings beat expectations, but sales declined: GAP reported adjusted EPS of $0.52 versus the $0.48 consensus estimate, while revenue fell 2% year over year to $3.65 billion. The company forecast fiscal 2026 EPS of $2.35–$2.45.
• Insiders have been selling while institutions add positions: Insiders sold more than 1 million shares worth about $24.25 million over the past three months, even as major investors including BlackRock and Bank of America initiated stakes. GAP also pays a quarterly dividend of $0.175 per share, yielding approximately 3.1%.

Shares of The Gap, Inc. (NYSE:GAP - Get Free Report) have received a consensus recommendation of "Hold" from the twenty-one brokerages that are covering the stock, Marketbeat Ratings reports. One investment analyst has rated the stock with a sell rating, thirteen have issued a hold rating, five have given a buy rating and two have issued a strong buy rating on the company. The average twelve-month target price among analysts that have updated their coverage on the stock in the last year is $27.07.

Several research analysts recently issued reports on the company. BMO Capital Markets initiated coverage on GAP in a research report on Tuesday, September 8th. They set a "market perform" rating and a $23.00 target price on the stock. Morgan Stanley increased their price target on GAP from $21.00 to $23.00 and gave the company an "equal weight" rating in a research report on Friday, August 28th. Wolfe Research started coverage on GAP in a research note on Wednesday. They set a "peer perform" rating on the stock. BTIG Research upped their target price on shares of GAP from $26.00 to $27.00 and gave the stock a "buy" rating in a research note on Friday, August 28th. Finally, The Goldman Sachs Group increased their target price on shares of GAP from $25.00 to $27.00 and gave the company a "buy" rating in a report on Monday, August 31st.

Insider Activity at GAP

In related news, insider Julie Gruber sold 27,538 shares of the stock in a transaction that occurred on Tuesday, October 6th. The stock was sold at an average price of $23.56, for a total transaction of $648,795.28. Following the completion of the sale, the insider directly owned 30,876 shares of the company's stock, valued at approximately $727,438.56. This trade represents a 47.14% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director William Fisher sold 500,000 shares of GAP stock in a transaction on Tuesday, October 6th. The stock was sold at an average price of $23.89, for a total value of $11,945,000.00. Following the sale, the director owned 15,903,198 shares in the company, valued at $379,927,400.22. This trade represents a 3.05% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last three months, insiders have sold 1,027,538 shares of company stock worth $24,249,556. Insiders own 31.00% of the company's stock.

Institutional Investors Weigh In On GAP

Several large investors have recently made changes to their positions in GAP. Jupiter Topco LLC bought a new stake in shares of GAP in the 2nd quarter worth approximately $2,017,000. BlackRock Inc. bought a new position in GAP during the second quarter valued at $428,824,000. Robinhood Asset Management LLC bought a new position in GAP during the second quarter valued at $6,312,000. Engineers Gate Manager LP bought a new stake in shares of GAP in the second quarter valued at $4,216,000. Finally, Bank of America Corp DE bought a new stake in shares of GAP in the second quarter valued at $30,345,000. 58.81% of the stock is owned by hedge funds and other institutional investors.

GAP Stock Performance

GAP opened at $22.93 on Friday. The company has a current ratio of 1.82, a quick ratio of 1.11 and a debt-to-equity ratio of 0.38. The company's fifty day moving average price is $21.92 and its two-hundred day moving average price is $21.90. GAP has a 1-year low of $18.11 and a 1-year high of $29.36. The company has a market cap of $8.05 billion, a price-to-earnings ratio of 6.85, a PEG ratio of 0.95 and a beta of 2.05.

GAP (NYSE:GAP - Get Free Report) last posted its earnings results on Thursday, August 27th. The company reported $0.52 EPS for the quarter, topping the consensus estimate of $0.48 by $0.04. GAP had a net margin of 8.14% and a return on equity of 19.72%. The company had revenue of $3.65 billion during the quarter, compared to the consensus estimate of $3.69 billion. During the same period in the previous year, the firm posted $0.57 earnings per share. The firm's revenue for the quarter was down 2.0% on a year-over-year basis. GAP has set its FY 2026 guidance at 2.350-2.450 EPS. On average, analysts expect that GAP will post 2.41 EPS for the current fiscal year.

GAP Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Wednesday, October 28th. Shareholders of record on Wednesday, October 7th will be given a dividend of $0.1750 per share. The ex-dividend date of this dividend is Wednesday, October 7th. This represents a $0.70 annualized dividend and a dividend yield of 3.1%. GAP's dividend payout ratio (DPR) is currently 20.90%.

GAP Company Profile

Gap, Inc operates as a global apparel retail company, which offers clothing, apparel, accessories, and personal care products for men, women, and children. The firm operates through the following segments: Gap Global, Old Navy Global, Banana Republic Global, Athleta, and Other. The Gap Global segment includes apparel and accessories for men and women under the Gap brand, along with the GapKids, BabyGap, GapMaternity, GapBody, and GapFit collections. The Old Navy Global segment offers clothing and accessories for adults and children.

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