Abercrombie Fitch (ANF) AI Stock Analysis

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Abercrombie Fitch

(NYSE:ANF)

Rating:67Neutral

Price Target:

$86.00

▲(8.85%Upside)

Abercrombie Fitch's overall stock score reflects solid financial performance and attractive valuation, tempered by mixed technical indicators and challenges highlighted in the earnings call. The company's strong revenue growth and Hollister's performance are positive, but risks such as margin pressures and tariff impacts need careful management.

Positive Factors

Brand Performance

Hollister continues to be strong, A&F is expected to inflect, and FY top-line guide was raised.

Market Strategy

Sales momentum is expected to continue due to multi-year efforts in marketing, product, and in-store presentation.

Negative Factors

Inventory Levels

Inventory levels increased significantly, which is seen as a temporary pressure for ANF.

Operating Margins

ANF lowered its operating margin guidance due to a $50M headwind from tariffs.

Promotional Activity

Decelerating A&F banner comps and higher promotional/discounting activity fuel investor fears of sales/profitability reversion risk.

Abercrombie Fitch (ANF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.86B

Dividend YieldN/A

Average Volume (3M)3.01M

Price to Earnings (P/E)7.8

Beta (1Y)1.29

Revenue Growth12.54%

EPS Growth25.47%

CountryUS

Employees6,600

SectorConsumer Cyclical

Sector Strength59

IndustryApparel - Retail

Share Statistics

EPS (TTM)1.59

Shares Outstanding47,643,314

10 Day Avg. Volume5,172,064

30 Day Avg. Volume3,007,020

Financial Highlights & Ratios

PEG Ratio-4.95

Price to Book (P/B)1.98

Price to Sales (P/S)0.00

P/FCF Ratio-8.23

Enterprise Value/Market Cap0.54

Enterprise Value/Revenue0.11

Enterprise Value/Gross Profit0.83

Enterprise Value/Ebitda0.61

Forecast

1Y Price Target

$117.67

Price Target Upside48.93% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

Abercrombie Fitch Business Overview & Revenue Model

Company DescriptionAbercrombie & Fitch Co. (ANF) is a leading global specialty retailer known for its casual luxury clothing and accessories. The company operates under several brands, including Abercrombie & Fitch, Abercrombie Kids, and Hollister Co., catering primarily to young adults and teenagers. With a strong emphasis on quality and style, ANF offers a wide range of products, including apparel, personal care items, and accessories, through its retail stores and online platforms worldwide.

How the Company Makes MoneyAbercrombie & Fitch Co. generates revenue primarily through the sale of clothing, accessories, and personal care products. The company's revenue model is based on direct-to-consumer sales through its network of retail stores and e-commerce platforms. Key revenue streams include the Abercrombie & Fitch brand targeting young adults, Abercrombie Kids for children, and Hollister Co., which focuses on a laid-back, beach-inspired lifestyle for teenagers. ANF's earnings are bolstered by strategic marketing efforts, brand loyalty programs, and the optimization of its digital channels to enhance customer engagement. Additionally, the company benefits from cost management strategies and inventory control to maximize profitability.

Abercrombie Fitch Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Analyzes revenue from different business segments, highlighting which areas drive growth and profitability for Abercrombie Fitch and where there might be opportunities or challenges.

Chart InsightsHollister's robust growth trajectory, highlighted by a 22% sales increase, contrasts with Abercrombie's 4% decline due to lower AUR from winter inventory. This divergence underscores Hollister's strong market positioning, particularly in fleece, jeans, and skirts, while Abercrombie faces challenges in optimizing its inventory strategy. Despite these mixed results, Abercrombie & Fitch Co. achieved record net sales, driven by Hollister's performance and regional growth, though tariff impacts and margin pressures remain concerns for future profitability.

Data provided by:

Main Street Data

Abercrombie Fitch Earnings Call Summary

Earnings Call Date:May 28, 2025

(Q1-2025)

% Change Since: 2.41%|

Next Earnings Date:Aug 21, 2025

Earnings Call Sentiment Neutral

The call presented a mixed picture. Significant achievements included record-breaking net sales and Hollister's strong performance. However, challenges were noted with Abercrombie's sales decline, gross margin pressures, and expected tariff impacts.

Q1-2025 Updates

Positive Updates

Record Net Sales and Growth

Achieved record net sales of $1.1 billion, marking an 8% growth compared to the previous year, surpassing the expected range of 4% to 6%.

Hollister Brand Success

Hollister led the way with a 22% net sales growth, continuing its eighth consecutive quarter of growth, with strong performance in fleece, jeans, and skirts.

Global Sales Growth

All regions experienced net sales growth: Americas up 7%, EMEA up 12%, and APAC up 5%.

Shareholder Returns

Returned $200 million to shareholders through share repurchases, equating to 5% of shares outstanding.

Negative Updates

Abercrombie Brand Decline

Abercrombie brands experienced a 4% net sales decline and a 10% decline in comparable sales, primarily due to lower Average Unit Retail (AUR) as a result of winter carryover inventory.

Gross Margin Decline

Operating margin decreased to 9.3% from 12.7% last year, impacted by lower gross margin and carryover inventory issues.

Impact of Tariffs

Projected tariffs to impact full-year operating margin by 100 basis points, with $50 million cost impact assumed for 2025.

Company Guidance

During the Abercrombie & Fitch Co. first-quarter earnings call for fiscal year 2025, the company reported net sales of $1.1 billion, an 8% increase from the previous year, surpassing their expected growth range of 4% to 6%. Earnings per share for the quarter were reported at $1.59, exceeding the anticipated figures. The company highlighted strong performance in the Hollister brand, which experienced a 22% growth in net sales and a 23% increase in comparable sales. However, Abercrombie brands saw a 4% decline in net sales and a 10% decrease in comparable sales, primarily due to lower average unit retail (AUR) from winter inventory carryover. Abercrombie & Fitch Co. also noted robust sales growth across all regions, with the Americas growing by 7%, EMEA by 12%, and APAC by 5%. The company utilized a strong balance sheet to return $200 million to shareholders through share repurchases. Looking forward, they project a 3% to 6% increase in full-year net sales, with a focus on mitigating tariff impacts and maintaining a 12.5% to 13.5% operating margin.

Abercrombie Fitch Financial Statement Overview

Summary

Abercrombie Fitch demonstrates solid revenue growth and improved operational efficiency in recent years but faces challenges with fluctuating margins and cash flow stability. The balance sheet shows improved leverage, though low equity levels in 2025 could pose risks. Overall, the company is on a positive trajectory but must manage potential volatility in its financial performance.

Income Statement

Positive

Abercrombie Fitch has shown a consistent revenue growth, particularly from 2023 to 2024, with a significant increase in net income. The gross profit margin has been strong, peaking at 62.92% in 2024. EBIT and EBITDA margins improved in 2024, indicating better operational efficiency. However, there were fluctuations in net profit margins, and there was a notable loss in 2021, which impacts overall stability.

Balance Sheet

Neutral

The company's debt-to-equity ratio has improved, decreasing from 1.65 in 2020 to 1.01 in 2024, indicating reduced leverage. Return on equity was highest in 2022 at 31.83%, but fell in 2023. The equity ratio has been fairly stable, but low equity in 2025 poses potential risks. Overall, the balance sheet shows mixed signals with improved leverage but lower equity levels.

Cash Flow

Neutral

Free cash flow turned positive in 2024 after being negative in 2023, with a significant growth rate of 396.86%. The operating cash flow to net income ratio was robust in 2024, suggesting effective cash generation relative to reported profits. However, negative cash flow metrics in 2023 highlight potential cash management concerns.

TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
5.03B	4.95B	4.28B	3.70B	3.71B	3.13B
	Gross Profit
2.50B	3.17B	2.69B	2.10B	2.31B	1.89B
	EBIT
614.75M	740.82M	484.67M	92.65M	343.08M	-20.47M
	EBITDA
759.97M	934.53M	659.71M	240.55M	494.99M	151.00M
	Net Income Common Stockholders
532.79M	566.22M	328.12M	2.82M	263.01M	-114.02M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
607.57M	888.95M	900.88M	517.60M	823.14M	1.10B
	Total Assets
3.10B	3.30B	2.97B	2.71B	2.94B	3.31B
	Total Debt
1.03B	951.61M	1.05B	1.22B	1.22B	1.55B
	Net Debt
515.34M	178.89M	147.48M	706.59M	400.52M	445.48M
	Total Liabilities
894.71M	1.95B	1.92B	2.01B	2.10B	2.37B
	Stockholders Equity
1.19B	1.34B	1.04B	694.84M	826.09M	936.63M
Cash Flow		Free Cash Flow
416.58M	527.47M	495.63M	-166.91M	177.02M	303.01M
	Operating Cash Flow
611.37M	710.38M	653.42M	-2.34M	274.00M	404.92M
	Investing Cash Flow
-289.58M	-297.70M	-157.18M	-140.68M	-96.98M	-51.91M
	Financing Cash Flow
-676.44M	-534.88M	-111.20M	-155.33M	-446.90M	69.72M

Abercrombie Fitch Technical Analysis

Technical Analysis Sentiment

Negative

Last Price79.01

Price Trends

50DMA

75.29

Positive

100DMA

87.66

Negative

200DMA

116.28

Negative

Market Momentum

MACD

1.29

Negative

RSI

51.20

Neutral

STOCH

35.54

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ANF, the sentiment is Negative. The current price of 79.01 is above the 20-day moving average (MA) of 78.97, above the 50-day MA of 75.29, and below the 200-day MA of 116.28, indicating a neutral trend. The MACD of 1.29 indicates Negative momentum. The RSI at 51.20 is Neutral, neither overbought nor oversold. The STOCH value of 35.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ANF.

Abercrombie Fitch Risk Analysis

Abercrombie Fitch disclosed 25 risk factors in its most recent earnings report. Abercrombie Fitch reported the most risks in the "Macro & Political" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Abercrombie Fitch Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
URBN	81 Outperform	$6.21B	14.51	19.55%	―	8.38%	52.18%
BKE	75 Outperform	$2.24B	11.24	44.55%	3.20%	-1.08%	-8.20%
GAP	72 Outperform	$8.29B	9.68	29.16%	2.97%	1.07%	28.03%
BOOT	68 Neutral	$4.96B	27.63	17.44%	―	14.64%	21.68%
ANF	67 Neutral	$3.86B	7.78	46.98%	―	12.54%	25.47%
AEO	64 Neutral	$1.80B	10.63	12.19%	4.81%	-0.95%	-10.51%
Sector *	63 Neutral	$6.98B	11.41	2.80%	4.24%	2.68%	-24.94%

* Consumer Cyclical Sector Average

Performance Comparison

ANF

Abercrombie Fitch

79.01

-113.33

-58.92%

AEO

American Eagle

10.11

-10.16

-50.12%

BKE

Buckle

43.66

10.16

30.33%

GAP

Gap Inc

22.35

-3.33

-12.97%

BOOT

Boot Barn

162.27

31.60

24.18%

URBN

Urban Outfitters

69.23

25.55

58.49%

Abercrombie Fitch Corporate Events

Business Operations and StrategyFinancial Disclosures

Abercrombie & Fitch Raises Sales Outlook for 2024

Positive

Jan 13, 2025

Abercrombie & Fitch Co. has increased its net sales outlook for the fourth quarter and full fiscal year 2024 following better-than-expected holiday sales. The company anticipates a net sales growth of 7-8% for the fourth quarter and around 15% for the full year, while maintaining a strong operating margin. This improvement reflects the company’s effective brand strategies and operational execution, positioning it for sustainable, profitable growth and exceeding its ‘Always Forward Plan 2025’ targets.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.