GAP (GPS) vs. Its Peers Financial Comparison

GAP (NYSE: GPS) is one of 31 public companies in the “Apparel & Accessories Retailers” industry, but how does it weigh in compared to its peers? We will compare GAP to related companies based on the strength of its valuation, institutional ownership, dividends, earnings, profitability, analyst recommendations and risk.

Analyst Ratings

This is a summary of current ratings and price targets for GAP and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GAP 3 19 6 0 2.11
GAP Competitors 524 3083 2970 89 2.39

GAP currently has a consensus price target of $28.13, suggesting a potential downside of 12.02%. As a group, “Apparel & Accessories Retailers” companies have a potential upside of 5.70%. Given GAP’s peers stronger consensus rating and higher probable upside, analysts plainly believe GAP has less favorable growth aspects than its peers.

Volatility and Risk

GAP has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500. Comparatively, GAP’s peers have a beta of 0.87, meaning that their average stock price is 13% less volatile than the S&P 500.

Profitability

This table compares GAP and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GAP 5.57% 27.47% 10.56%
GAP Competitors 2.05% 5.44% 6.23%

Insider & Institutional Ownership

54.8% of GAP shares are owned by institutional investors. Comparatively, 73.7% of shares of all “Apparel & Accessories Retailers” companies are owned by institutional investors. 27.3% of GAP shares are owned by company insiders. Comparatively, 16.4% of shares of all “Apparel & Accessories Retailers” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Dividends

GAP pays an annual dividend of $0.92 per share and has a dividend yield of 2.9%. GAP pays out 42.4% of its earnings in the form of a dividend. As a group, “Apparel & Accessories Retailers” companies pay a dividend yield of 2.5% and pay out 56.3% of their earnings in the form of a dividend. GAP has increased its dividend for 7 consecutive years. GAP is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares GAP and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
GAP $15.52 billion $676.00 million 14.74
GAP Competitors $3.99 billion $181.38 million 984.54

GAP has higher revenue and earnings than its peers. GAP is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

GAP beats its peers on 9 of the 15 factors compared.

GAP Company Profile

The Gap, Inc. (Gap Inc.) is an apparel retail company. The Company offers apparel, accessories and personal care products for men, women and children under the Gap, Banana Republic, Old Navy, Athleta and Intermix brands. Its products are available to customers online through Company-owned Websites and through the use of third-parties that provide logistics and fulfillment services. In addition to operating in the specialty, outlet, online and franchise channels, it also uses the Company’s omni-channel capabilities to bridge the digital world and physical stores. Its omni-channel services, including order-in-store, reserve-in-store, find-in-store and ship-from-store are tailored across its portfolio of brands. It also sells products that are designed and manufactured by branded third-parties, especially at its Intermix brands. It has Company-operated stores in the United States, Canada, the United Kingdom, France, Ireland, Japan, Italy, China, Hong Kong, Taiwan, and Mexico.

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