Gap Stock Price and Forecast: Why is GPS down 20%? Is $5 the next target?
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- Gap stock is down over 20% in premarket.
- Gap stock earnings reports came out after the close on Tuesday.
- GPS missed on EPS and revenue.
The Gap (GPS) stock fell pretty heavily afterhours on Monday as it reported earnings. The numbers were disappointing with earnings per share (EPS) coming in at $0.27 versus the $0.50 estimate. Revenue was also behind estimates, coming in at $3.94 billion versus $4.44 billion expected. The shares immediately dumped, falling over 20%. The Gap quote at the time of writing is $18.57, a loss of 21%.
GAP Inc chart, 5-minute
Gap (GPS) stock news
We have mentioned the top and bottom line numbers above, but in addition Gap also lowered forecasts due to supply chain issues. Those words have been hitting investors this year, and Gap made a huge reduction to its FY adjusted EPS guidance. This was at $2.10-$2.25 previously, but now Gap guides it at $1.25 to $1.40. This is a huge drop as COVID-19 factory closures in Vietnam have hit Gap especially hard. Gap gets about 30% of its supplies from Vietnam. The downgrades and price target changes are coming in thick and fast this morning with Goldman, Credit Suisse, Wells Fargo, Telsey, Deutsche and B.Riley all lowering their price targets for Gap, while JPMorgan downgraded the stock.
Gap (GPS) stock forecast
Gap had already been struggling and trading in a down channel, but now it has exploded out of that. It was already below the yearly Volume-Weighted Average Price (VWAP), as well as 100 and 200-day moving averages, so trying to buy this one was going against the technical picture. We see no let-up in sight, with $18 being a large support zone going back on the weekly chart. This shows the large volume area until $16. If Gap gets below that, then single figures will surely beckon, not to mention a test of the pandemic lows at $5.26. There is interim support at $12 along the way.
GPS 1-day chart
- Gap stock is down over 20% in premarket.
- Gap stock earnings reports came out after the close on Tuesday.
- GPS missed on EPS and revenue.
The Gap (GPS) stock fell pretty heavily afterhours on Monday as it reported earnings. The numbers were disappointing with earnings per share (EPS) coming in at $0.27 versus the $0.50 estimate. Revenue was also behind estimates, coming in at $3.94 billion versus $4.44 billion expected. The shares immediately dumped, falling over 20%. The Gap quote at the time of writing is $18.57, a loss of 21%.
GAP Inc chart, 5-minute
Gap (GPS) stock news
We have mentioned the top and bottom line numbers above, but in addition Gap also lowered forecasts due to supply chain issues. Those words have been hitting investors this year, and Gap made a huge reduction to its FY adjusted EPS guidance. This was at $2.10-$2.25 previously, but now Gap guides it at $1.25 to $1.40. This is a huge drop as COVID-19 factory closures in Vietnam have hit Gap especially hard. Gap gets about 30% of its supplies from Vietnam. The downgrades and price target changes are coming in thick and fast this morning with Goldman, Credit Suisse, Wells Fargo, Telsey, Deutsche and B.Riley all lowering their price targets for Gap, while JPMorgan downgraded the stock.
Gap (GPS) stock forecast
Gap had already been struggling and trading in a down channel, but now it has exploded out of that. It was already below the yearly Volume-Weighted Average Price (VWAP), as well as 100 and 200-day moving averages, so trying to buy this one was going against the technical picture. We see no let-up in sight, with $18 being a large support zone going back on the weekly chart. This shows the large volume area until $16. If Gap gets below that, then single figures will surely beckon, not to mention a test of the pandemic lows at $5.26. There is interim support at $12 along the way.
GPS 1-day chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.