GAP (NYSE:GAP) Rating Lowered to Neutral at JPMorgan Chase & Co.

Key Points

• JPMorgan downgraded GAP from “overweight” to “neutral” and kept a $27 price target, which still implies about 8.2% upside from the stock’s current level.
• GAP’s latest quarter missed earnings and revenue estimates, reporting EPS of $0.38 versus $0.39 expected and revenue of $3.50 billion versus $3.52 billion forecasted.
• The company cut its full-year sales outlook to 1% to 2% revenue growth from 2% to 3%, citing softer demand at Old Navy and weaker discretionary spending.

GAP (NYSE:GAP - Get Free Report) was downgraded by analysts at JPMorgan Chase & Co. from an "overweight" rating to a "neutral" rating in a research note issued on Friday. They currently have a $27.00 target price on the stock. JPMorgan Chase & Co.'s price objective indicates a potential upside of 8.23% from the company's current price.

A number of other equities research analysts have also issued reports on the stock. TD Cowen dropped 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. Zacks Research downgraded shares of GAP from a "strong-buy" rating to a "hold" rating in a research note on Monday, February 2nd. Citigroup upped their price objective on shares of GAP from $25.00 to $27.00 and gave the company a "neutral" rating in a research note on Friday, March 6th. The Goldman Sachs Group cut their price target on GAP from $32.00 to $28.00 and set a "buy" rating for the company in a report on Friday. Finally, BTIG Research reiterated a "buy" rating and issued a $28.00 price objective on shares of GAP in a report on Friday. Two equities research analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating and six have issued a Hold rating to the company's stock. According to MarketBeat, GAP currently has a consensus rating of "Moderate Buy" and a consensus price target of $28.64.

GAP Price Performance

Shares of GAP stock opened at $24.95 on Friday. The company has a debt-to-equity ratio of 0.39, a current ratio of 1.75 and a quick ratio of 1.08. The business has a 50 day simple moving average of $24.26 and a two-hundred day simple moving average of $25.69. The stock has a market capitalization of $9.11 billion, a P/E ratio of 11.60, a PEG ratio of 1.39 and a beta of 2.11. GAP has a 12 month low of $18.68 and a 12 month high of $29.36.

GAP (NYSE:GAP - Get Free Report) last issued its quarterly earnings results on Thursday, May 28th. The company reported $0.38 EPS for the quarter, missing the consensus estimate of $0.39 by ($0.01). The firm had revenue of $3.50 billion for the quarter, compared to analysts' expectations of $3.52 billion. GAP had a return on equity of 22.98% and a net margin of 5.31%.The firm's revenue for the quarter was up 1.0% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.51 earnings per share. GAP has set its FY 2026 guidance at 2.300-2.400 EPS. As a group, analysts predict that GAP will post 2.29 EPS for the current fiscal year.

Insider Transactions at GAP

In other news, insider Amanda J. Thompson sold 25,000 shares of the business's stock in a transaction that occurred on Monday, April 6th. The shares were sold at an average price of $25.14, for a total transaction of $628,500.00. Following the completion of the sale, the insider owned 86,228 shares in the company, valued at approximately $2,167,771.92. The trade was a 22.48% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, major shareholder John J. Fisher sold 300,000 shares of the stock in a transaction on Wednesday, April 8th. The shares were sold at an average price of $25.40, for a total transaction of $7,620,000.00. Following the completion of the transaction, the insider directly owned 446,781 shares in the company, valued at $11,348,237.40. This trade represents a 40.17% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 923,098 shares of company stock valued at $22,648,158 over the last quarter. Insiders own 31.00% of the company's stock.

Institutional Trading of GAP

Several institutional investors and hedge funds have recently made changes to their positions in GAP. Glenmede Trust Co. NA lifted its stake in shares of GAP by 146.5% in the first quarter. Glenmede Trust Co. NA now owns 77,435 shares of the company's stock valued at $1,874,000 after purchasing an additional 46,017 shares during the period. Kentucky Retirement Systems purchased a new position in GAP in the first quarter valued at about $529,000. California State Teachers Retirement System lifted its position in shares of GAP by 23.5% during the 1st quarter. California State Teachers Retirement System now owns 279,201 shares of the company's stock valued at $6,757,000 after acquiring an additional 53,098 shares during the period. Miller Howard Investments Inc. NY lifted its position in shares of GAP by 112.2% during the 1st quarter. Miller Howard Investments Inc. NY now owns 1,704,021 shares of the company's stock valued at $41,237,000 after acquiring an additional 900,855 shares during the period. Finally, Public Employees Retirement System of Ohio boosted its stake in shares of GAP by 2.7% during the 4th quarter. Public Employees Retirement System of Ohio now owns 73,812 shares of the company's stock worth $1,890,000 after acquiring an additional 1,945 shares in the last quarter. 58.81% of the stock is owned by hedge funds and other institutional investors.

Key GAP News

Here are the key news stories impacting GAP this week:

• Negative Sentiment: Gap cut its full-year sales forecast, saying slower growth at Old Navy and weaker discretionary spending are hurting demand. The company now expects revenue growth of 1% to 2%, down from 2% to 3%, which raised concerns about consumer softness and near-term sales momentum. Article Title
• Negative Sentiment: The company missed first-quarter revenue expectations and posted EPS of $0.38 versus the $0.39 estimate, reinforcing worries that results are not keeping pace with analyst forecasts. Article Title
• Negative Sentiment: Management said Old Navy’s spring and summer assortment did not resonate with shoppers, a key reason the company lowered its outlook and why the stock dropped sharply in after-hours and premarket trading. Article Title
• Neutral Sentiment: Gap still reported some positives, including 1% revenue growth, 2% comparable-sales growth, and a raised full-year EPS outlook, but those upside points were outweighed by the cautious sales guidance. Article Title

About GAP

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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