ANF - Abercrombie & Fitch bulls say underlying trends look strong

Abercrombie & Fitch (NYSE:ANF) traded even lower on Thursday after plunging on Wednesday when the retailer missed consensus estimates with its Q4 earnings report and warned of ongoing margin pressure. Higher freight costs were one of the biggest drags on ANF's profitability in Q4. On Wall Street, Telsey Advisory Group lowered its price target to $40 from $45 but kept an Outperform rating on ANF. Analyst Dana Telsey: "While supply chain costs look to continue to weigh on earnings potential through FY22, the topline trends and outlook are in line with prior expectations, speaking to the underlying health of the company's brands, in our view. Beyond nearer-term macro pressures, we continue to see operating margin growth potential through square footage productivity benefits as a result of store remodels, fleet optimization efforts, and online growth, and we view ANF's offering as well-positioned in the current consumer environment." B Riley Securities cuts

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Abercrombie & Fitch bulls say underlying trends look strong