|Bid||0.00 x 1200|
|Ask||19.36 x 3100|
|Day's Range||19.11 - 19.76|
|52 Week Range||15.11 - 31.39|
|Beta (3Y Monthly)||0.78|
|PE Ratio (TTM)||7.84|
|Earnings Date||Nov 18, 2019 - Nov 22, 2019|
|Forward Dividend & Yield||0.97 (5.04%)|
|1y Target Est||19.84|
(Bloomberg) -- J. Crew Group Inc. plans to spin off its Madewell denim chain in a public offering, the company announced in a filing Friday, five months after announcing it was considering such a move.The number of shares to be offered and the price range for the proposed offering haven’t yet been determined, according to the filing. The amount of the IPO is listed in the filing as $100 million, a placeholder that will likely change. Chinos Holdings Inc., which owns J. Crew, expects to use any proceeds to pay down debt and for general corporate purposes.Madewell would follow Levi Strauss & Co. as the next denim company to tap public markets. It will have to gauge investor demand, however, as most apparel retailers’ shares have lost value this year. In J. Crew’s case, however, debt-related needs may take precedence over timing.“The IPO could garner a substantial valuation and help pay down a meaningful portion of the over $1.7 billion in debt,” said Raya Sokolyanska, an analyst at Moody’s Investors Service. “But the ultimate ability to address J. Crew’s highly leveraged capital structure depends on the public market’s receptivity to apparel retailers and the company’s operating performance.”New DebtChinos will be renamed Madewell Group Inc. before the IPO is completed, the company said. As part of the proposed transaction, Chinos will incur new debt and use the net proceeds it receives from the offering to repay its remaining debt obligations previous to the spinoff of the business from J. Crew.The possibility that J. Crew will file for bankruptcy is listed in the filing as a risk for the IPO. J. Crew’s creditors could request that the court consolidate its assets and liabilities with Madewell assets and liabilities, according to the filing. The consolidation would allow the creditors to satisfy their claims from the combined assets as part of J. Crew’s filing, it said.Madewell’s current Chief Executive Officer Libby Wadle and Chief Financial Officer of J. Crew Group Vincent Zanna will stay in their roles just until the separation, according to a filing. Michael Nicholson, who was named interim chief executive officer of J. Crew Group in April, will also take on the interim CFO role when Zanna leaves.Madewell ExpansionMadewell, which has resonated with millennial shoppers, has opened a few stores in recent months and has plans to open at least six more by early next year from Southern California to Tampa, Florida. The company currently has about 130 locations. The expansion comes as its sister company J. Crew shuttered dozens of locations and rival mall stores including Gap Inc. are lowering store counts.J. Crew was in negotiations with its creditors around a debt transaction that ended in a stalemate, according to its filings. The company said it made a proposal to a group of both loan and note holders but couldn’t reach an agreement with them. There are no further discussions scheduled at this time, it said.The company proposed a separation of J. Crew and Madewell, an IPO of Madewell’s equity, the issuance of new debt, and a recapitalization of the company’s balance sheet, according to filings. To facilitate the proposed transactions, members of the creditor group would need to give their consent and tender their holdings.Creditors’ ProposalCreditors proposed a deal in which term loan and note holders would exchange a portion of their holdings for new debt with additional collateral from the IPO of Madewell and existing J. Crew common equity, according to the filings.J. Crew is working with advisers from law firm Weil Gotshal & Manges and investment bank Lazard Ltd, according filings.Creditors enlisted investment bank PJT Partners Inc., according to a proposal debt deal from the lender group titled “Project Paddle.”(Updates with creditor negotiations in ninth paragraph)\--With assistance from Jordyn Holman.To contact the reporters on this story: Lisa Wolfson in Boston at email@example.com;Katherine Doherty in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Anne Riley Moffat at email@example.com, Jonathan Roeder, Michael HythaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Gap Inc (NYSE: GPS ) hosted its investor day on Thursday, announcing the ambitious plan to open 800 Old Navy stores despite seeing a downturn in the business . Morgan Stanley: Mind The Gap Morgan Stanley ...
News about Old Navy opening more stores is going around as the company prepares to spin off from Gap (NYSE:GPS).Source: JHVEPhoto / Shutterstock.com The current plans from Old Navy is to open 800 more stores. However, it won't be doing this all at once. Instead, the retail company's goal is to open 75 new stores a year until it reaches 2,000 locations. That would have it almost doubling its current store countPlans for Old Navy opening more stores will have it targeting smaller areas that don't currently have much in the way of clothing retailers. The company also notes that it will be avoiding malls and instead put stores in their own buildings.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThat last move makes sense for the clothing retailer. Malls in the U.S. have been seeing a drop in foot traffic and it's hurting the retail industry. Despite this, Old Navy has been doing well and is looking toward growth when it spins off from Gap in 2020, reports CNN Business. * 7 Discount Retail Stocks to Buy for a Recession The spinoff of Old Navy was announced by Gap earlier this year. It will have Old Navy becoming its own publicly traded company. This news about Old Navy opening more stores also falls in lines with comments made by Gap back then. At the time, it said the retailer has room to grow due to its brand recognition and leadership position in the clothing market.GPS stock was up 1% as of Friday afternoon, but is down 25% since the start of the year. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money As of this writing, William White did not hold a position in any of the aforementioned securities.The post Old Navy Opening More Stores, Plans for 800 More Locations appeared first on InvestorPlace.
During the Gap Inc. investor meeting on Thursday Sonia Syngal, Old Navy's chief executive, said the brand has plans to nearly double the number of stores in its North American fleet to 2,000, focused mostly on smaller markets. Old Navy will spin off from Gap Inc. and operate as a standalone company. Syngal said, as a standalone, Old Navy will take steps to become a $10 billion brand. "We see ample growth opportunity at Old Navy, but it's not based on future independence," wrote MKM Partners' Roxanne Meyer in a note. "We see growth opportunities from store expansion (plans to nearly double the store fleet, with growth in smaller markets), new categories and larger sizes." MKM is taking a "wait-and-see" approach to the spinoff, maintaining its neutral rating for Gap stock and $18 fair value estimate. "[W]e do have worries that apparel, and especially the important women's apparel segments at both Gap and Old Navy are simply structurally tough categories," wrote Cowen analysts, in a note. "Women's apparel could be prone to multiple years of unforeseen, but likely, promotional risk." Cowen rates Gap stock market perform with a $22 price target. Gap stock has taken a 31% tumble over the past year while the S&P 500 index has gained 3.7% for the period.
The popular discount arm of the San Francisco-based retailer could nearly double its brick-and-mortar footprint after becoming its own public company.
Gap Inc. said Thursday that it will begin franchising Athleta, the company's athleisure brand, and Janie & Jack, Gap's children's chain. Both Athleta and Janie & Jack have company-operated stores. Gap began franchising its brands in 2006 when it opened a franchised Gap location in Singapore. The company now has more than 500 Gap, Old Navy and Banana Republic franchised locations around the world, along with e-commerce sites. Both Athleta and Janie & Jack will begin with franchised online shops and store-in-store locations "in order to generate market awareness for these brands," the company said on its blog. Gap announced that it had acquired the Janie & Jack brand from Gymboree in March 2019. Gap stock has taken a 32.4% tumble over the past year while the S&P 500 index has gained 4.4% for the period.
As a standalone company, Old Navy, which offers more affordable clothing and accessories, plans to open 860 stores in North America and said it would focus on opening outlets in smaller markets and off-mall locations. Old Navy, which recorded net sales of about $8 billion in 2018 and ended the year with 1,140 locations, said with the new store openings it plans to reach more than $10 billion in annual sales in the long term. Earlier this year, Gap announced that it would spin off the Old Navy brand, a bright spot for the struggling retailer, into a publicly listed company.
(Bloomberg Opinion) -- Gap Inc. offered a first glimpse Thursday of how it aims to proceed once it splits its retail empire in two. The upshot: Do not expect a return to glory at its namesake chain any time soon.After Old Navy becomes a standalone business, the new company, which will include the Gap, Banana Republic, Athleta and smaller brands, will face a difficult set of challenges. Some of these are the result of the bleak retail landscape — but several are of its own making.Current Gap CEO Art Peck will lead the everything-but-Old-Navy company after the split. On Thursday he outlined some sensible areas of focus, including attracting younger customers, shoring up its denim business and testing remodeled stores. But the company’s weak track record during Peck’s tenure doesn’t inspire confidence.Gap has had basically the same problem for the last half decade or so: It doesn’t have the right selection of clothing in its stores. When Peck became CEO in early 2015, he correctly diagnosed that sales at Gap and Banana Republic were suffering because the aesthetic, fit and quality of the garments were off the mark. His top priority, he said, was to fix that.By late 2017, however, he had other issues. Because of poor inventory management, Gap again had the wrong mix of merchandise. Sales suffered as the ratio of tops to bottoms in stores was off, making it hard to put together an outfit. Stores, executives said, were “overassorted” — that is, cluttered with too many options.In both cases, Peck said Gap had a handle on things. In August 2015, he told investors, “I am confident that Gap will make significant progress in spring.” But comparable sales remained in decline at the chain when that batch of clothes landed.With the later operational woes, the company acknowledged early on it would take a while to clean up the mess. During a 2018 second-quarter earnings call, Peck told investors that “the worst is behind us.” In the third quarter, Gap delivered an even steeper drop in comparable sales.In both these cases, the retailer apparently did not have a thorough understanding of the scale of the problem and how long it would take to repair.So it’s no surprise, then, it has struggled to get customers to open their wallets. As I noted earlier this year, it lags behind its peers on key indicators of fashion and reputation.It doesn’t help that Gap has been slow to react to key changes in the larger retail environment. Earlier this year, it announced plans to close 230 stores. Peck rightly noted the move was “overdue”: It had been obvious for years that Gap had too many stores for the digital era and those located in dumpy malls were hurting the brand.Gap also hasn’t made much progress in restraining itself from offering steep discounts. In 2015, referring to Gap’s near-constant “40% off your purchase” promotions, Peck said, “We've been way too 40 off every day in too many places in this company.” In 2019, these deals are still rampant: The Gap chain has offered a discount every day this month.Sure, Old Navy has (until recently) enjoyed a steady run of good performance — not insignificant given it is the company’s largest brand. But there has never been a quarter under Peck in which all three of its major stores recorded positive comparable sales.(1)It’s tempting, of course, to see Gap’s struggles as emblematic of a generally gloomy retail landscape. But compare its trajectory to that of Target Corp. The CEOs of both retailers got their jobs at roughly the same time — Brian Cornell hit his five-year anniversary at the helm of Target in August, a milestone Peck will reach in February.In that time, Cornell has dramatically improved Target, developing successful private brands, remodeling stores and fortifying Target’s e-commerce division. He made tough choices such as shuttering its disastrous Canada business. Target shares hit an all-time high last week.Gap certainly has not stood still during the last five years. It has overhauled its supply chain to churn out designs faster and expanded its promising Athleta chain. It has occasionally nailed a trend, such as with last year’s “logo remix” collection. But after years of moving its chess pieces around the board, Gap doesn’t appear to be a fundamentally different retailer. It’s hard to see how its position is improved after this split.(1) There was one quarter in which Gap had flat comparable sales and the other two major brands saw growth on this metric.To contact the author of this story: Sarah Halzack at firstname.lastname@example.orgTo contact the editor responsible for this story: Michael Newman at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Sarah Halzack is a Bloomberg Opinion columnist covering the consumer and retail industries. She was previously a national retail reporter for the Washington Post.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
As part of its Meet the Management investor event today, Gap Inc. executives will provide an update on the company’s planned separation into two independent publicly traded companies, as well as an overview of strategic priorities for the new Gap Inc.
Breaking down Lululemon's (LULU) Q2 2019 financial results that wowed Wall Street last week. And why Lulu stock looks like a buy as it expands its digital, international, and menswear businesses to further challenge Nike (NKE) - Full-Court Finance.
Gap Inc. today announced that it will host a meeting with management for the investment community on Thursday, September 12, 2019 in New York.
Welcome to the latest episode of the Full-Court Finance podcast where Associate Stock Strategist Ben Rains dives into everything investors need to know about Lululemon (LULU) stock before the company reports its Q2 earnings results on Thursday...
(Bloomberg Opinion) -- Americans better make the most of their Labor Day discount shopping. It could be the last they see for a long time.A 15% tariff that went into effect Sept. 1 on about $112 billion of goods imported from China will start pushing up prices of clothing, shoes and other consumer goods arriving at U.S. ports this week.That should start taking a serious toll on shopping in the U.S. While 82% of intermediate inputs are already affected by tariffs, just 29% of consumer goods have had levies to date. That figure will now rise to 69%, and 99% when a final tranche is imposed on Dec. 15, according to the Peterson Institute for International Economics.The Trump administration – or at least its trade representative, Robert Lighthizer – has recognized the risk of bringing the trade war to consumers’ pockets. The current total-war scenario, with tariffs imposed on almost the entirety of imports from China, was first threatened more than a year ago, but Lighthizer has worked hard to excise the sorts of goods purchased by price-sensitive shoppers from his product lists.The latest escalation means that sort of strategic precision is no longer possible. Around the country, apparel retailers have already worked out where best to jack up prices, while toy shops and sporting-goods stores will be doing the same ahead of the post-Thanksgiving tranche.One unexpected ally for the Trump administration is the retail industry itself. This is a business that invented the term “sticker shock,” after all, so trying to hide the costs of Trump’s policies from consumers isn’t exactly unfamiliar terrain.“The teams are working on a targeted pricing strategy in certain categories,” Gap Inc. Chief Financial Officer Teri List-Stoll told an investor call last month.“We have lots of tools in place to monitor elasticity and what the competitive environment is,” Kohl’s Corp. Chief Executive Officer Michelle Gass told analysts Aug. 21. “So we'll make very sound and surgical decisions.”There’s already a model for how this is likely to play out. One of the first rounds of tariffs imposed by the Trump administration applied a 25% levy on washing machines, but an April study by economists at the Federal Reserve and University of Chicago found that retailers instead decided to spread the pain around.Prices for washing machines jumped about 12% more than those of comparable goods after the levies were imposed – which might have suggested that stores and suppliers were taking some of the pain rather than passing the full 25% cost onto consumers. There was a telling exception, though: The price of dryers rose by about the same magnitude, despite the fact that they weren’t affected by the tariffs. In other words, retailers were splitting the extra cost between two similar products in an attempt to minimize the apparent rise in prices.As a result, shoppers are unlikely to see markup racks with “Prices raised on account of trade war” tags on them. Instead, watch out for harder-to-pin-down increases in categories where individual chains have pricing power, as well as weakening of gross margins, cost-sharing with Chinese vendors, and efforts to shift parts of the supply chain to other source countries. Returns on equity for consumer and durable goods companies in the S&P 500 index are already at recessionary levels, despite the general buoyancy of stocks in 2019; you’d be bold to bet that was set to improve over the balance of the year.Consumer sentiment is tracking down from its recent rosy levels in any case. Expectations for the economy suffered their sharpest monthly fall since 2012 in the University of Michigan’s latest survey. Views of current conditions fell to their lowest level since President Donald Trump was elected, and Republicans posted their most pessimistic consumer sentiment since Trump’s inauguration.(1)The strong U.S. economy over the past two years gave President Trump latitude to prosecute his trade battle with China – but as it starts to weaken, that may test his resolve. Given the relief in financial markets in recent days at signs of a detente, he might want to consider the benefits of a more lasting peace.(1) There's a strong partisan split in consumer sentiment, with views jumping sharply depending on whether or not a consumer's favored party is in the White House.To contact the author of this story: David Fickling at firstname.lastname@example.orgTo contact the editor responsible for this story: Rachel Rosenthal at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
2019 is being referred to as the ‘summer of spiked seltzer’. The industry has grown in popularity, with hard seltzer accounting for 5% of the U.S. beer market in July, growing more than 164% year-over-year, according to Bank of America Merrill Lynch’s 2019 Global Beverage survey.
Industry experts believe that the spin-off of Old Navy from Gap (GPS) will enable the two stand-alone companies to better capitalize growth opportunities.
Gap Inc. (GPS) today announced that, following the completion of the planned spin-off of Old Navy, the new public company, currently referred to as NewCo, will retain the Gap Inc. name. The new Gap Inc. will be a portfolio of brands, including Gap brand, Banana Republic, Athleta, Intermix, Janie and Jack, and Hill City. The announcement comes as the company wraps-up a week-long celebration of its iconic Gap brand’s 50th anniversary.
From large-scale retailers like Gap Inc. to smaller food producers, Bay Area companies are scrambling to stay ahead of the trade war.