GAP (NYSE:GAP) Lowered to Hold Rating by Evercore

Key Points

• Evercore downgraded GAP from strong-buy to hold, adding to a wave of softer analyst sentiment after the retailer’s recent earnings report.
• GAP’s latest quarter missed expectations, with EPS of $0.38 versus $0.39 expected and revenue of $3.50 billion versus $3.52 billion forecast. The company also lowered its outlook, with fiscal 2026 EPS guidance set at 2.300-2.400.
• Wall Street has largely cut price targets on the stock, though most ratings remain positive or neutral; the consensus target price is now $28.71 versus GAP’s Friday opening price of $21.14.

GAP (NYSE:GAP - Get Free Report) was downgraded by equities researchers at Evercore from a "strong-buy" rating to a "hold" rating in a report released on Friday,Zacks.com reports.

Several other equities analysts have also weighed in on the stock. TD Cowen cut their target price on shares of GAP from $32.00 to $26.00 and set a "buy" rating for the company in a report on Monday, May 18th. Jefferies Financial Group cut their target price on shares of GAP from $32.00 to $29.00 and set a "buy" rating for the company in a report on Friday. Barclays cut their target price on shares of GAP from $33.00 to $26.00 and set an "overweight" rating for the company in a report on Friday. The Goldman Sachs Group cut their target price on shares of GAP from $32.00 to $28.00 and set a "buy" rating for the company in a report on Friday. Finally, Bank of America cut their target price on shares of GAP from $29.00 to $26.00 and set a "neutral" rating for the company in a report on Friday. Two investment analysts have rated the stock with a Strong Buy rating, ten have given a Buy rating and six have issued a Hold rating to the stock. According to MarketBeat.com, GAP presently has an average rating of "Moderate Buy" and a consensus target price of $28.71.

GAP Stock Performance

GAP opened at $21.14 on Friday. GAP has a 12-month low of $18.68 and a 12-month high of $29.36. The company has a current ratio of 1.75, a quick ratio of 1.08 and a debt-to-equity ratio of 0.39. The firm has a market capitalization of $7.72 billion, a PE ratio of 8.32, a P/E/G ratio of 1.45 and a beta of 2.11. The firm has a 50 day moving average of $24.20 and a two-hundred day moving average of $25.66.

GAP (NYSE:GAP - Get Free Report) last posted its quarterly earnings results on Thursday, May 28th. The company reported $0.38 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.39 by ($0.01). GAP had a return on equity of 21.17% and a net margin of 6.25%.The business had revenue of $3.50 billion for the quarter, compared to analysts' expectations of $3.52 billion. During the same period in the prior year, the business posted $0.51 earnings per share. The business's quarterly revenue was up 1.0% compared to the same quarter last year. GAP has set its FY 2026 guidance at 2.300-2.400 EPS. On average, analysts anticipate that GAP will post 2.29 EPS for the current year.

Insider Buying and Selling

In related news, insider Eric Kayen Chan sold 13,377 shares of the business's stock in a transaction on Friday, April 10th. The shares were sold at an average price of $26.18, for a total value of $350,209.86. Following the completion of the sale, the insider owned 21,967 shares of the company's stock, valued at approximately $575,096.06. The trade was a 37.85% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, major shareholder John J. Fisher sold 300,000 shares of the business's stock in a transaction on Wednesday, April 8th. The stock was sold at an average price of $25.40, for a total transaction of $7,620,000.00. Following the completion of the sale, the insider directly owned 446,781 shares of the company's stock, valued at approximately $11,348,237.40. The trade was a 40.17% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 923,098 shares of company stock worth $22,648,158 in the last 90 days. 31.00% of the stock is owned by insiders.

Institutional Investors Weigh In On GAP

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Cullen Frost Bankers Inc. purchased a new stake in GAP in the 4th quarter worth $26,000. Plato Investment Management Ltd purchased a new stake in GAP in the 4th quarter worth $28,000. V Square Quantitative Management LLC purchased a new stake in GAP in the 4th quarter worth $31,000. Cornerstone Planning Group LLC purchased a new stake in GAP in the 3rd quarter worth $35,000. Finally, EverSource Wealth Advisors LLC increased its holdings in GAP by 177.0% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 7,016 shares of the company's stock worth $153,000 after acquiring an additional 4,483 shares in the last quarter. Hedge funds and other institutional investors own 58.81% of the company's stock.

Key Stories Impacting GAP

Here are the key news stories impacting GAP this week:

• Negative Sentiment: The Gap reported Q1 EPS of $0.38, missing estimates, and revenue of $3.50 billion, also slightly below expectations. The market is reacting to the earnings miss and lower revenue trend. Article Title
• Negative Sentiment: Management lowered fiscal 2026 revenue guidance to 1% to 2% growth from 2% to 3%, citing slower Old Navy growth and weaker-than-expected spring/summer demand. Article Title
• Negative Sentiment: Several headlines highlighted that shares fell sharply after the company’s cautious Q2 outlook and sales guidance reset, with analysts and media focusing on the weak consumer backdrop and pressure on nonessential spending. Article Title
• Neutral Sentiment: Gap still posted 2% comparable sales growth for a ninth straight quarter, and the flagship Gap brand remained relatively strong, which partially offsets the weaker outlook. Article Title
• Neutral Sentiment: Analysts broadly kept positive or neutral ratings but lowered price targets, signaling that Wall Street sees upside from current levels, while acknowledging slower near-term growth. Article Title
• Negative Sentiment: A shareholder investigation notice added another overhang, reflecting investor concern that the quarter’s results may have involved disclosure or securities-law issues. Article Title

GAP Company Profile

Gap Inc is a global specialty retailer renowned for its portfolio of apparel and accessories brands, including Gap, Banana Republic, Old Navy and Athleta. The company designs, sources and markets clothing across a broad price range and style spectrum, catering to men, women and children. Its offerings extend from everyday wardrobe essentials such as denim, tees and outerwear to performance and lifestyle pieces, reflecting each brand's distinct identity and price point.

Founded in San Francisco in 1969 by Donald and Doris Fisher, Gap Inc has grown into one of the world's largest apparel companies.

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