Goldman Sachs downgraded shares of The Gap ahead of the critical holiday shopping season. Is this a sign retail may be in trouble?
The Gap, one of the nation's largest retailers, was just downgraded by Goldman Sachs ahead of the critical holiday shopping season. Is this a sign of trouble ahead for retailers in general?
On Monday, Goldman lowered its ratings on the Gap (ticker symbol GPS) from "buy" to "neutral", saying:
Read More »from Goldman Sachs’ Christmas warning
"We downgrade GPS to Neutral from Buy as we expect near-term demand headwinds will hamper comp sales and gross margin. Recent data points have left us incrementally more concerned about the prospects for 3Q13 and holiday: (1) GPS September sales report exposed vulnerability to macro challenges, including traffic weakness and a need to step-up promotions; this is a change for GPS which YTD was insulated from macro weakness, (2) pricing points to a tough October for the Gap brand, and (3) we see little to improve the course of business between now and holiday. Since