ANF Stock Rises Premarket: Retail Traders Say Abercrombie & Fitch Is 'Undervalued' Ahead Of Earnings

• Abercrombie & Fitch will report its fiscal Q1 earnings today.
• Last week, Raymond James trimmed its price target for Abercrombie & Fitch to $92 from $110.
• Raymond James warned that weaker discretionary spending and higher gas prices could pressure Hollister’s budget-conscious shoppers.

Abercrombie & Fitch Co. (ANF) stock gained in premarket on Wednesday ahead of its fiscal first-quarter (Q1) earnings as investors and retail traders focus on whether the apparel retailer can sustain its profitability gains amid a tougher retail backdrop. 

Shares of the company have declined each month since March. The upcoming earnings report arrives as analysts debate whether the company’s margin expansion can withstand increasing promotional activity across the teen apparel industry. 

Raymond James Trims ANF’s Price Target 

Last week, Raymond James trimmed its price target for Abercrombie & Fitch to $92 from $110, citing growing concerns about weaker performance trends at the company’s Hollister brand.

The reduced price target still implies a 23% upside to the stock’s closing price on Tuesday. 

Analysts pointed to slowing customer activity across stores and digital channels, heavier promotional activity, and softer apparel demand signals in Europe as key risks weighing on the retailer’s near-term outlook.

Raymond James said Hollister could face more difficulties as budget-conscious shoppers cut back on non-essential spending. Analysts added that higher gas prices may put extra pressure on the brand’s younger, price-sensitive customers. 

The firm also pointed to rising discounts across clothing categories, suggesting retailers are depending more on price cuts to attract shoppers in a highly competitive market. 

Abercrombie & Fitch stock traded over 3% higher in Wednesday’s premarket. 

ANF’s Momentum Faces Pressure

After climbing to a 52-week high above $133 in early January, Abercrombie shares have retreated nearly 40%, trading near the upper-$70 range. 

Analysts see Abercrombie & Fitch to report a Q1 revenue of $1.12 billion with $1.28 earnings per share, according to Fiscal AI data. The company expects Q1 sales to grow in teh range of 1% to 3% with EPS between $1.20 to $1.30. 

ANF Retail Traders View 

On Stocktwits, retail sentiment around the stock shifted to ‘bullish’ from ‘neutral’ territory. 

A user said, “Reluctantly sold my $CROX to buy more $ANF . Severely undervalued and more room to run in the near term.”

Another user said, “hoping for $ANF good earnings will make this run.”

ANF stock has declined over 40% year-to-date. 

Also See: GRPN Stock Rises Premarket: Groupon Is Rebuilding Itself As ‘AI-Native’ Company

For updates and corrections, email newsroom[at]stocktwits[dot]com.