"We believe estimates will be revised downward based on the weak September comp to an estimate more in-line with ours, which will likely result in share pressure near term," Jaffe wrote. "We would be buyers of GPS shares in weakness given our long-term, favorable outlook for the company."
Still, it seems the consumer's shift to buying other larger items has hit even one of the strongest retailers and likely won't bode well for the upcoming holiday season.
Gap is feeling the same pressure that many other chain stores are feeling. September same-store sales rose just 0.4%, excluding the drug stores, below expectations of a 3.1% rise and last year's 5.5% monthly gain, according to
"The 0.4% result is the weakest showing since the recession, when the index registered a -2.4% [same-store sales] result in August 2009," a note by Thomson Reuters said.
Teen retailers have had a particularly hard time attracting customers of late. September sales continued that trend.
same store sales fell 6%. Comp sales at
also declined last month, down 4.5% and 0.6%, respectively.
-- Written by Laurie Kulikowski in New York.
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