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Gap (GPS) Astronomical 200% Rise: What's Really Behind The Retailer's Resurgence?

Gap (GPS) - ★★★ - Ranked 60th in our Q1 2024 Mid & Small Cap Rankings

Gap Inc. (GPS), the iconic American clothing retailer, has staged a remarkable comeback over the past year. The company's stock price has skyrocketed by an eye-popping 212% in the last 12 months, leaving investors and industry analysts in awe. Gap's impressive performance is underpinned by a consistent record of positive earnings surprises, as it hasn't missed analysts' consensus earnings estimates in any of the last four quarters.

In its latest earnings report on March 7, 2024, Gap reported earnings per share (EPS) of $0.49, handsomely beating the consensus estimate of $0.20. The company also surpassed revenue expectations, with a 2.03% beat over the consensus revenue estimate.

For the current fiscal year, Gap is expected to post earnings of $1.36 per share on $14.86 billion in revenues, representing a 4.9% decline in EPS but only a slight 0.19% drop in revenues compared to the previous year. Looking ahead, analysts are projecting further growth, with Gap anticipated to earn $1.48 per share on $15.11 billion in revenues for the next fiscal year, reflecting year-over-year increases of 8.71% and 1.7%, respectively.

Just a year ago, Gap was struggling with declining sales, supply chain disruptions, and fierce competition from fast-fashion retailers and e-commerce giants. However, the company's fortunes have taken a dramatic turn under the leadership of its new CEO, Richard Dickson, who took the helm in 2022.

Gap (GPS) has a ★★★ star rating and is ranked #60 in our Q1 2024 Mid & Small Cap Rankings.

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