Gap Inc
GAP: XNYS (USA)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
$94.70 | Lyyw | Bhmzfywx |
No-Moat Gap Cuts Costs and Reorganizes as It Seeks a CEO and Stability; Shares Undervalued
Closing a painful year, Gap underperformed our modest expectations in 2022’s fourth quarter. Moreover, its guidance for a mid-single-digit percentage sales decline in 2023 is disappointing. Even so, we are encouraged that the firm (even with an interim CEO) is not standing still as, in conjunction with the earnings report, it announced $300 million in cost savings in addition to the $250 million identified last year. Moreover, Gap has made major organizational and personnel changes and expects to name a permanent CEO soon.