This may be one of the most hated stores in the retail sector but the future is improving. I picked ANF for a position because of the coming back to school season where teenagers drag mom to the mall. They do not shop on Amazon. They want to try on everything in the store and only pick the ones that are perfect for their "look."
NEW BULLISH Plays
ANF - Abercrombie & Fitch - Company Profile
Abercrombie & Fitch Co. operates as a specialty retailer of casual apparel. The company sells knit and woven shirts, graphic T-shirts, fleece, jeans and woven pants, shorts, sweaters, and outerwear; personal care products; and accessories for men, women, and kids under the Abercrombie & Fitch, Abercrombie kids, and Hollister brand names. As of March 2, 2016, it operated through 754 stores in the United States; and 178 stores in Canada, Europe, Asia, and the Middle East. The company sells its products through its stores and direct-to-consumer sales.
Abercrombie has been pounded from the highs at $33 back in March after some disappointing earnings and weak outlook for the retail sector. Since then they have cleaned up their inventory levels and dumped a ton of bad product choices. Now they are heading into their heavy selling season and ready to go head to head with other stores.
The company has been in a restructuring period for over a year where they remodeled stores, dumped inventory and closed unprofitable locations. The drop from $33 to $16 took all the fluff out of the stock price and shares are moving higher today. They closed at a 2-month high on Wednesday.
If the market begins to roll over, these previously oversold stocks will look like a safe haven for investors looking for a bargain. This is Abercrombie's biggest selling season so sentiment should remain positive through Labor Day.
Earnings August 25th.
With a ANF trade at $20.10
Buy ANF shares, initial stop loss $18.85.
No options recommended.
NEW BEARISH Plays
No New Bearish Plays