GAP Inc. (NYSE:GAP) is a San Fransisco, California-based apparel retail company. It is the largest specialty apparel company in the United States, home to iconic brands like Old Navy, Banana Republican, and Athleta. Shares of GAP climbed 2.5% month-over-month as of close on Thursday, August 29, 2024. Meanwhile, the stock has climbed 9.1% in the year-to-date period.
The company released its second quarter (Q2) fiscal 2024 earnings on the same day. In Q2 FY2024, GAP reported net sales of $3.7 billion – up 5% compared to the second quarter of fiscal 2023. Meanwhile, comparable sales increased 3%. Store sales and online sales increased 4% and 7%, respectively, compared to the prior year. GAP posted net income of $206 million or $0.54 diluted earnings per share (EPS). On the financials front, the company finished the quarter with cash, cash equivalents, and short-term investments that totalled $2.1 billion – up 59% from the previous year.
Looking ahead, the GAP has reaffirmed its net sales and operating expense outlook for fiscal 2024 and increased its outlook for gross margin and operating income growth compared to its prior projections. For the full year fiscal 2024, GAP is projecting operating income in the mid-to-high 50% growth range. Meanwhile, it expects capital expenditures of roughly $500 million.
GAP stock currently possesses a favourable price-to-earnings ratio of 12. The company is on track for solid earnings growth going forward.
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