The Numbers, The Names
Gap Inc (NYSE:GPS) reported first quarter earnings yesterday after the market closed, announcing that first-quarter sales fell well below revenue estimates disappointing Wall Street Analysts and shareholders alike.
Shares of the multinational clothing company which operates stores under the label Banana Republic and Old Navy– to name a few- fell nearly 2.5% in aftermarket trading down to around $39.00.
Gap store sales were down 15%, and neither of Gap’s other main store brands was able to post an April gain, with Old Navy same-store sales down 6% and Banana Republic same-store sales down 15%.By contrast, In April of 2014 Gap’s global sales rose 9%.
Where The Traps Were For Gap’s Earnings
One of the main reasons that Gap Inc. stated for their revenue miss was from the strong US dollar which has also shown to adversely be affecting other multinational U.S. corporations’ revenues and earnings this first quarter season. This is a phenomenon in currencies, because of the strength in the U.S Dollar right now, strong sales in foreign currencies amount to less U.S money once they are translated back into U.S. dollars.
The Price Chart/ The Profits
Please see below the monthly price bar chart for Gap Inc from 2009 till the present, showing steady green arrows of monthly growth in share price throughout the years reaching a high of nearly $47 per share in late 2014.
An investor who put money to work after the financial crisis until now has been doing very well in this specialty retailer company, gaining roughly 161 % on their investment. Because many investors and analysts hold Gap and its subsidiaries in high regard, any weakness or pullback in shares will likely be met with strong support as the American economy shows an avid interest in always dressing well and looking good. This is one area that has never disappointed in the Gap Inc. name.
About Gap Inc.
Gap Inc. is a leading global retailer offering clothing, accessories, and personal care products for men, women, and children under the Gap, Banana Republic, Old Navy, Athleta, and Intermix brands. Fiscal year 2014 net sales were $16.4 billion. Gap Inc. products are available for purchase in more than 90 countries worldwide through about 3,300 company-operated stores, over 400 franchise stores, and e-commerce sites.