This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Gap Falls as Murphy Trumpets Global Growth Plans

NEW YORK ( TheStreet) - Gap Inc. (GPS - Get Report) shares were dropping in New York as the retailer said it plans to open new stores for its flagship brand as well as for Banana Republic and Old Navy in Asia and Brazil to grow sales.

The $17-billion market cap company, which also owns Piperlime, Athleta and newly-acquired Intermix, is looking to expand internationally with its lower-price point brand, Old Navy. Gap plans to begin franchising Old Navy stores in 2014 in "key" international markets, the said San Francsico-based company in a statement Wednesday.

"We're entering a period of global growth," said Chairman and CEO Glenn Murphy in the statement. "We see it particularly in some countries ... [where] double-digit growth is to keep up with the market."

Gap shares were falling 1.7% to $37.15.

Gap is also considering adding company-operated Old Navy and Banana Republic stores in China, based on the success it has had so far with its flagship brand there, Murphy said at an investor gathering Wednesday. The company is also looking to grow in San Paulo and New Delhi with Gap stores, the CEO added.

Noting that consumers in international markets are eager to buy cultural and fashion cues from American style, the company plans to "make sure we can dominate on this front and be the world's favorite on American style," Murphy said.

The global retail apparel market is a $1.4 trillion business, of which $300 billion comes from the U.S. market. Internationally, Gap's market share rose to 0.5% in 2012 from 0.25%.

"For us to win, we've got to win on two dimensions ... You need integrated customer experience -- one brand, one experience online or offline, whatever we can do to satisfy customers," Murphy said.

Gap had about 3.9% of the U.S. market share last year, up 20 basis points from the year before. Murphy said the company has the potential to reach 4.5% of the U.S. market.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
GPS $22.98 -0.86%
TGT $80.12 0.78%
AAPL $93.64 -0.11%
FB $118.57 0.84%
GOOG $698.21 0.75%


Chart of I:DJI
DOW 17,891.16 +117.52 0.66%
S&P 500 2,081.43 +16.13 0.78%
NASDAQ 4,817.5940 +42.2360 0.88%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs