Gap Stock Soars After Argus Upgrade On Brand’s Revival: Retail’s Extremely Bullish

Shares of Gap Inc. ($GAP) surged more than 6% on Tuesday after the fashion retailer got an upgrade from analyst firm Argus, lifting retail sentiment.

Argus analyst Christine Dooley gave Gap a ‘Buy,’ upgrading it from ‘Hold’ with a $27 price target, Fly.com reported.  The analyst cited the work done by the company’s management in revitalizing the brands that had lagged the market in recent years. Gap is also expected to show earnings growth over the next several quarters, according to the analyst.

The analyst also highlighted that Gap shares currently trade at a low P/E ratio of 11 times forecast earnings when compared to its peer group, but with above peer-average dividend yields.

Sentiment on Stocktwits jumped to ‘extremely bullish’ from ‘neutral’ a day ago. Message volumes rose to ‘extremely high.’

GAP sentiment meter and message volumes on Jan 22 as of 2:05 am ET

Last week, UBS analyst Jay Sole upgraded Gap to ‘Neutral’ from ‘Sell’ with a price target of $26, up from $16.

According to UBS, Gap CEO Richard Dickson has been on the forefront of driving important change, showing the management's ability to increase the relevance of Gap's brands and deliver consistent operational improvements.

Wall Street analysts expect Gap to have earnings per share of $0.36 on estimated revenue of 
$4.07 billion, according to Stocktwits data.

Gap’s brands include Banana Republic, Old Navy, and Athleta.

Gap stock is up 5.37% year-to-date.

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