Continue to site >
Trending ETFs
You have successfully subscribed to Advisor Access. Thank you!
Help us personalize your experience.
Which type of investor describes you best?
Help us personalize your experience.
What is your AUM?
Knowing your investable assets will help us build and prioritize features that will suit your investment needs.

Congratulations on personalizing your experience.

Email is verified. Thank you!

What The Gap Upgrade Means for Mutual Fund Investors (GPS)

Shauna O'Brien

|

The Gap Storefront
Before the opening bell on Monday, Jefferies boosted its rating on The Gap (GPS). Here’s what the move means for mutual fund investors.

Inside the Analyst Move

Jefferies has upgraded The Gap from “Hold” to “Buy” and has named the stock its “best new idea” for 2015.

According to analyst Randal Konik, the company’s catalysts include:

  • Strong momentum in its Old Navy segment.
  • Sourcing cost tailwinds from cotton prices are at five-year lows.
  • Free cash flow accelerates as cap ex/sales ratio lowers.
  • The company’s brand remains relevant

Fairly Valued, with Several Potential Catalysts

From a valuation standpoint, GPS is fairly valued. There are also several catalysts and opportunities with this stock, including potential buybacks and lower commodity prices. A private equity deal could be possible in the future, although the company may be too expensive to spark interest.

Mutual Funds to Watch

Investors interested in GPS may also be interested in the funds listed below. These funds currently have the largest stakes in the company.
Symbol Mutual Fund Stake
VTSMX Vanguard Total Stock Market Index 0.95%
VFINX Vanguard 500 Index 0.69%
TRMCX T. Rowe Price Mid-Cap Value 0.36%

The Bottom Line

The funds above allow investors to gain exposure to GPS while remaining diversified. Investors interested in The Gap may also be interested in L Brands (LB) and The Buckle (BKE).

Sign up for Advisor Access

Receive email updates about best performers, news, CE accredited webcasts and more.

Popular Articles

Read Next

The Gap Storefront

What The Gap Upgrade Means for Mutual Fund Investors (GPS)

Shauna O'Brien

|

Before the opening bell on Monday, Jefferies boosted its rating on The Gap (GPS). Here’s what the move means for mutual fund investors.

Inside the Analyst Move

Jefferies has upgraded The Gap from “Hold” to “Buy” and has named the stock its “best new idea” for 2015.

According to analyst Randal Konik, the company’s catalysts include:

  • Strong momentum in its Old Navy segment.
  • Sourcing cost tailwinds from cotton prices are at five-year lows.
  • Free cash flow accelerates as cap ex/sales ratio lowers.
  • The company’s brand remains relevant

Fairly Valued, with Several Potential Catalysts

From a valuation standpoint, GPS is fairly valued. There are also several catalysts and opportunities with this stock, including potential buybacks and lower commodity prices. A private equity deal could be possible in the future, although the company may be too expensive to spark interest.

Mutual Funds to Watch

Investors interested in GPS may also be interested in the funds listed below. These funds currently have the largest stakes in the company.
Symbol Mutual Fund Stake
VTSMX Vanguard Total Stock Market Index 0.95%
VFINX Vanguard 500 Index 0.69%
TRMCX T. Rowe Price Mid-Cap Value 0.36%

The Bottom Line

The funds above allow investors to gain exposure to GPS while remaining diversified. Investors interested in The Gap may also be interested in L Brands (LB) and The Buckle (BKE).

Sign up for Advisor Access

Receive email updates about best performers, news, CE accredited webcasts and more.

Popular Articles

Read Next

Advertisement

×

Wait! Do you know all the important aspects of mutual funds?

×

Free Advisor Access newsletter emailed to you.

Receive free and exclusive email updates for financial advisors about best performers, news, CE accredited webcasts and more.

Sign up for Advisor Access

Receive email updates about best performers, news, CE accredited webcasts and more.

Disclaimer: By registering, you agree to share your data with MutualFunds.com and opt-in to receiving occasional communications about projects and events. The contents of this form are subject to the MutualFunds.com Privacy Policy. You can unsubscribe at any time.