Barclays Initiates Coverage On Abercrombie & Fitch With ‘Equal Weight’ Rating: Retail On The Sidelines

synopsis

Investment bank Barclays has initiated coverage on Abercrombie & Fitch with an 'Equal Weight' rating and a $71 price target, the Fly reported.

The target is lower than the $72.77 level the shares closed at on Monday.

Barclays noted some positive and concerning markers in the business.

It said its view of the company's "strong brand heat, best-in-class" omnichannel model, and future store growth opportunities is balanced by the risks from elevated inventory levels, potentially peaking margins, higher marketing spending, and sector-wide tariff uncertainty.

Abercrombie & Fitch sells casual apparel under the eponymous brand name, and Hollister and Gilly Hicks. It operates over 780 stores worldwide and clocked nearly $5 billion in revenue last year.

However, its 2025 sales forecast of 3% to 5% growth, compared to the 16% growth last year, has weakened investor interest and weighed shares.

Last week, JPMorgan and Citi cut their price targets on the stock, according to the Fly. However, JPMorgan added the company to its Focus List, a list of securities in which it has convictions.

On Stocktwits, retail investors' sentiment was 'bearish', with 'extremely low' message volume.

ANF sentiment and message volume as of April 21 | Source: Stocktwits

One user suggested keeping an eye on the stock because a potential trade deal with Vietnam, a key manufacturing hub for American labels, is likely and will lift shares when that happens.

Abercrombie shares are down over 50% year to date.

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