GPS

Buys gps small in at 18.00

Support is at $17.60

Gap reports April same store sales -7% vs +1.1% Retail Metrics consensus; issues downside Q1 EPS guidance with sales below consensus  (21.81 +0.14)
5/9/2016, 4:19:01 PM ET
  • Co issues downside guidance for Q1 (Apr), sees EPS of $0.31 -0.32 vs. $0.45 Capital IQ Consensus Estimate; sees Q1 (Apr) revs of $3.44 bln vs. $3.54 bln Capital IQ Consensus Estimate. As previously disclosed, gross margins were pressured as the company entered April with more inventory than planned as a result of weaker than expected traffic, which began in late March 2016 and continued into April. The company also noted that the Sunday and Monday of the Memorial Day holiday falls in the fiscal month of June this year versus May last year. The company expects the later holiday timing to negatively impact May sales results and benefit June sales results.
  • Comparable sales by global brand for April 2016 were as follows:
    • Gap Global: negative 4 percent versus negative 15 percent last year
    • Banana Republic Global: -7% vs -5.1% BR Retail Metrics consensus
    • Old Navy Global: -10 percent vs +2.6% Old Navy Retail Metrics consensus
  • Gap Inc. also announced that it will take steps to better position the company for improved business performance and to build for the future. The company is identifying opportunities to streamline its operating model to be more efficient and flexible, while more fully exploiting its scale advantage. Additionally, the company is evaluating its Banana Republic and Old Navy fleets, primarily outside of North America, in order to sharpen its focus on geographies with the greatest potential. More details will be shared during the company’s first quarter fiscal 2016 earnings announcement on May 19, 2016.
  • Courtesy of Briefing.com

This puts GPS at half the sector (XRT) P/E of 16

Large orders at $17.76 or will at to my current position on a bounce.

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