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Wells Fargo sees 22% upside potential in Gap, upgrades to Overweight
Summary
Retailer Gap Inc. (NYSE: GPS) received a rating and price target upgrade from broker Wells Fargo. Praising clothing retailer Gap’s turnaround story, Wells Fargo raised its rating on the stock from ‘equal weight’ to ‘overweight’.
The broker pointed out that Gap’s setup has become compelling with right-sized inventory, better cost controls and fresh management. The new team is expected to help reignite key brands, while the new CEO holds a strong track record with heritage brands.
The broker also stated that inventory is normalizing and the path to gross margin recovery is now visible.
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