Morgan Stanley slashes price target on The Gap Inc. [GPS] – find out why.


The Gap Inc. [NYSE: GPS] traded at a low on 04/22/22, posting a -17.98 loss after which it closed the day’ session at $11.72. The company report on April 21, 2022 that Gap Inc. Announces Old Navy Leadership Change.

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Gap Inc. (NYSE: GPS) announced today that Old Navy President and CEO Nancy Green is exiting the Old Navy business this week.

“We believe in the power and potential of the Old Navy brand and the contribution it will have as we execute our Power Plan strategy and drive value creation at Gap Inc.,” said Gap Inc. CEO Sonia Syngal. “As we look to seize Old Navy’s potential, particularly amidst the macro-economic dynamics facing our industry, we believe now is the right time to bring in a new leader with the operational rigor and creative vision to execute on the brand’s unique value proposition. I want to thank Nancy Green for her decades of leadership and passion for our brands and customers, as well as the communities we serve.”.

The results of the trading session contributed to over 39088361 shares changing hands. Over the past one week, the price volatility of The Gap Inc. stands at 4.75% while the volatility over the past one month is 5.04%.

The market cap for GPS stock reached $5.31 billion, with 373.00 million shares outstanding and 185.14 million shares in the current float. Compared to the average trading volume of 10.70M shares, GPS reached a trading volume of 39088361 in the most recent trading day, which is why market watchdogs consider the stock to be active.

What do top market gurus say about The Gap Inc. [GPS]?

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for GPS shares is $15.29 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on GPS stock is a recommendation set at 2.70. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Morgan Stanley have made an estimate for The Gap Inc. shares, keeping their opinion on the stock as Equal-Weight, with their previous recommendation back on April 18, 2022. While these analysts kept the previous recommendation, Barclays dropped their target price from $17 to $13. The new note on the price target was released on April 01, 2022, representing the official price target for The Gap Inc. stock. Previously, the target price had yet another raise to $13.75, while Daiwa Securities analysts kept a Underperform rating on GPS stock. On February 15, 2022, analysts decreased their price target for GPS shares from 26 to 14.

The Average True Range (ATR) for The Gap Inc. is set at 0.88, with the Price to Sales ratio for GPS stock in the period of the last 12 months amounting to 0.32. The Price to Book ratio for the last quarter was 1.61, with the Price to Cash per share for the same quarter was set at 1.93.

How has GPS stock performed recently?

The Gap Inc. [GPS] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -16.94. With this latest performance, GPS shares dropped by -16.70% in over the last four-week period, additionally sinking by -48.89% over the last 6 months – not to mention a drop of -65.54% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for GPS stock in for the last two-week period is set at 32.03, with the RSI for the last a single of trading hit 26.63, and the three-weeks RSI is set at 35.10 for The Gap Inc. [GPS]. The present Moving Average for the last 50 days of trading for this stock 14.38, while it was recorded at 13.84 for the last single week of trading, and 20.70 for the last 200 days.

The Gap Inc. [GPS]: Deeper insight into the fundamentals

Operating Margin for any stock indicates how profitable investing would be, and The Gap Inc. [GPS] shares currently have an operating margin of +4.79 and a Gross Margin at +39.90. The Gap Inc.’s Net Margin is presently recorded at +1.54.

Return on Equity for this stock inclined to 9.60, with Return on Assets sitting at 1.93.

The Gap Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 0.50 and a Current Ratio set at 1.30.

Earnings analysis for The Gap Inc. [GPS]

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for GPS. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for The Gap Inc. go to 17.50%.

Insider trade positions for The Gap Inc. [GPS]

There are presently around $2,550 million, or 63.70% of GPS stock, in the hands of institutional investors. The top three institutional holders of GPS stocks are: JPMORGAN CHASE & CO with ownership of 35,092,225, which is approximately 2.666% of the company’s market cap and around 11.30% of the total institutional ownership; VANGUARD GROUP INC, holding 27,695,377 shares of the stock with an approximate value of $324.59 million in GPS stocks shares; and DODGE & COX, currently with $287.03 million in GPS stock with ownership of nearly 5.976% of the company’s market capitalization.

Positions in The Gap Inc. stocks held by institutional investors increased at the end of March and at the time of the March reporting period, where 211 institutional holders increased their position in The Gap Inc. [NYSE:GPS] by around 37,478,688 shares. Additionally, 181 investors decreased positions by around 35,228,722 shares, while 60 investors held positions by with 144,844,927 shares. The mentioned changes placed institutional holdings at 217,552,337 shares, according to the latest SEC report filing. GPS stock had 77 new institutional investments in for a total of 7,273,648 shares, while 74 institutional investors sold positions of 19,083,523 shares during the same period.