Citigroup upgraded GPS to "buy" from "neutral" this morning
Gap Inc (NYSE:GPS) stock is up 3.6% to trade at $23.02 this morning, after Citigroup issued an upgrade to "buy" from "neutral," and raised its price objective to $28 from $21. The brokerage firm noted the apparel retailer could beat earnings estimates for the first quarter amid steady consumer demand, as well as consumer trends that favor denim.
Gap stock scored a three-year high of $28.59 on March 21. The shares have suffered a 19.4% drawdown this quarter though, and recently had consolidated around $20 in the last three weeks. In the last 12 months, GPS added 162.8%.
There is plenty of room for additional upgrades and/or price-target hikes. In fact, 10 of 16 analysts in coverage called the equity a tepid "hold" or worse coming into today, while the 12-month consensus target price of $21.33 is a roughly 4% discount to current levels.
A short squeeze is also in play, with short interest down 7.5% over the last two reporting periods. However, the 31.91 million shares sold short still make up 14.3% of the security's available float.