Abercrombie & Fitch Stock Dips Despite Stellar Quarterly Results

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Abercrombie & Fitch (ANF), the parent company of popular brands Abercrombie and Hollister, saw its stock prices decline after reporting impressive quarterly earnings and raising guidance. Although the shares had been trading at multiyear highs, it appears that investors decided to take profits.

According to FactSet, Abercrombie posted adjusted third-quarter earnings of $1.83 per share, surpassing analyst expectations of $1.18. This is a significant improvement from the same period last year when the company reported a mere one cent per share.

The retailer’s quarterly net sales also exceeded Wall Street estimates, with a total of $1.056 billion compared to the projected $981 million. Furthermore, Abercrombie’s same-store sales experienced a remarkable 16% increase from the previous year, surpassing analysts’ predictions of a 10.5% surge.

As the crucial holiday season approaches, CEO Fran Horowitz expressed confidence in the company’s ability to maintain this growth. “Entering the important holiday season, our fiscal 2023 year-to-date results give us the confidence that we can continue to deliver for our customers and drive profitable growth,” stated Horowitz.

Abercrombie now expects a net sales growth of 12% to 14% for the fiscal year, up from its previous projection of approximately 10%. Additionally, the company anticipates an operating margin of around 10%, an increase from the earlier range of 8% to 9%. In the fiscal fourth quarter, Abercrombie forecasts low double-digit growth in net sales compared to the same period last year.

Despite these positive financials, Abercrombie & Fitch stock fell by 6.1% to $67.89 in premarket trading. Nevertheless, it is important to note that the stock has tripled in value this year and is currently trading at prices not seen since 2011.

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