Abercrombie & Fitch pullback an opportunity, says Jefferies

After Abercrombie & Fitch provided updated guidance, raising its Q4 net sales growth guidance from 5%-7% to 7%-8% and raising its FY24 net sales growth view from 14%-15% to 15% while reiterating its operating margin outlook, Jefferies noted that also embedded in today’s long-term update is management’s plan for operating income and EPS to grow faster than sales. The firm, which thinks this framework to be “achievable given our productivity work,” sees the pullback as an opportunity and maintains a Buy rating and $220 price target on A&F shares, which are down 18% to $131.56 in Monday afternoon trading.