Wedbush Boosts Target for Abercrombie & Fitch; Recent Channel Checks Looking Good (ANF)

Wedbush Boosts Target for Abercrombie & Fitch; Recent Channel Checks Looking Good (ANF)


Teen clothing retailer Abercrombie & Fitch Co. (ANF) late Friday received some continued bullish support from analysts at Wedbush Securities.

The firm reiterated its “Outperform” rating on ANF and lifted its price target from $48 to $56. That new target suggests an 18% upside to the stock’s Friday closing price of $47.37.

A Wedbush analyst commented, “With solid QTD checks that suggest strong Black Friday and early Holiday sales trends, we are raising our estimates above consensus. Similar to trends witnessed in Q3, we believe both core A&F and Hollister stores continue to make sequential progress driving solid sales momentum. We believe traffic and conversion levels continue to improve despite reduced clearance. Specifically, our Retail Specialists have noted that at Hollister ‘the retailer excluded fashion SKUs from promotional activity yet inventory levels continued to decrease substantially…We also continue to notice a pullback in price pointing of guy’s hoodies and t-shirts with up to a $5 (10%) improvement over last year on similar quality merchandise.’”

Abercrombie & Fitch shares were unchanged in premarket trading Monday. The stock has fallen around 3% since the beginning of 2012.

The Bottom Line
Shares of Abercrombie & Fitch (ANF) have a 1.48% dividend yield, based on Friday’s closing stock price of $47.37. The stock has technical support in the $40-$42 price area. If the shares can firm up, we see overhead resistance around the $50-$51 price levels.

Abercrombie & Fitch Co. (ANF) is not recommended at this time, holding a DARS™ Rating of 3.1 out of 5 stars.

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