(Abercrombie & Fitch articles updated with additional analysis of the stock, updated stock prices, and analyst commentary.)NEW YORK ( TheStreet) -- Don't call Abercrombie & Fitch ( ANF) a recovery story -- or a buy -- just yet. While the teen retailer easily topped Wall Street's forecast (excluding restructuring costs related to the closure of Ruehl) and is seeing margin improvement, without its gift card promotion, things would have been worse in the fourth quarter. "With select early spring already marked down and CEO
Abercrombie is focused on international expansion It plans on opening its namesake store in Copenhagen, Denmark and Fukuoka, Japan during the year. Given that international sales were 15% of fourth-quarter sales, this expansion could limit sales declines and support margins in 2010, Meyer wrote. Abercrombie management also expects to roll out a Hollister flagship store in New York, as well as 30 mall-based stores internationally. "Through a combination of international flagship Abercrombie & Fitch store openings, international Hollister mall-based openings and U.S. store closures, there is reason to believe that Abercrombie & Fitch's base of earnings will increase in 2010 and 2011, barring any economic shock," Sozzi wrote in a note. As a result he upgraded the retailer to hold from sell and raised his price target on the stock to $37 from $26. Shares of Abercrombie are rising 4.4% to $35.35 in morning trading. -- Reported by Jeanine Poggi in New York. Follow TheStreet.com on Twitter and become a fan on Facebook.