The Gap, Inc. (GPS) Insiders Are Selling, Here’s Why

At The Gap, Inc. (NYSE:GPS), the ratio of insider selling to insider buying over a quarter is running at 1. Could this be a sign something is bothering insiders? GPS recorded 1 sales count on the open market in the last three months. They sold nearly 977 shares while purchases amounted to zero shares that period. Looking even further back to 12 months, corporate insiders offloaded 2,902,852 shares when buyers snapped up 5,000 shares. The 12-month’s totals signify about a 580.57-to-1 sell/buy ratio.

Fisher William Sydney parted with a total of 1 million shares of The Gap, Inc. (GPS) at average share price of $32.37. This insider trade in the company took place on 06/19/2018. The total for the sales was set at $32.37 million. After this transaction, the Director, 10% Owner account balance stood at 37.91 million shares. The stock lost -16.84 percent since that insider sale. On 04/04/2018, Fisher Robert J, Director, 10% Owner, sold 500 thousand shares at a price per share of $31.28. This removed 15.64 million shares from the insider’s fortune and the stock saw a -13.94 percent retreat in value since the news became public. This transaction left 37.88 million shares in the Director, 10% Owner account.

On 04/03/2018, VP & Chief Accounting Officer Bazzano Dara performed a sale transaction worth $15.76 thousand. This sale at $31.02 each has eliminated 0.51 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -13.22 percent decrease since the transaction was reported. The insider now is left with 0 thousand shares remaining in the account. Fisher William Sydney, who performs the Director, 10% Owner job, sold 500 thousand shares for $16.05 million. The disposal occurred on 03/22/2018 was priced at $32.1 per share. The share price plunged -16.14 percent since the reporting date. Fisher William Sydney now left with a stake of 38.92 million GPS stock worth $1074.64 million after the insider selling.

The 12-month median price target for The Gap, Inc. (GPS) assigned by the analysts stands at $29, which represents a return potential of 5.03 percent when compared to the closing price of the stock of $27.61 on Thursday, December 06. The lowest price target for the stock is $24 — slightly more than -13.07 percent from GPS’s current share price. The stock will probably climb 7.75 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $50-month high price target. This represents a whopping 81.09 percent increase from where shares are trading today.

On momentum oscillators front, ‘RSI’ has touched 53.98 on daily chart, which may remain a cause for concern. If the price breaks below $25.98 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $28.04 mark may result into a pull-back move towards $28.48 level. The stock is currently hovering around the first support level of $26.79. Below this, the next support is placed in the zone of $25.98. Till the time, the GPS stock trades above this level, bulls have nothing to fear.

Shares of The Gap, Inc. (GPS) are trading at a P/E ratio of 13.97 times earnings reported for the past 12 months. The industry GPS operates in has an average P/E of 34.92. Its P/E ratio went as low as 11.1X and as high as 14.36 over the 5-year span. Further, it is sporting a 0.62 on the Price-to-Sales ratio. Compare this with the industry average P/S of 2.33. 38.5 percent is the gross profit margin for The Gap, Inc. and operating margin sits at 8.7 percent. Along with this, the net profit margin is 5.2 percent.

On 6th of December, The Gap, Inc. (NYSE:GPS) shares ended higher after a volatile session. The shares accumulated 0.69 points or 2.56 percent at $27.61 with a heavy trade volume of 5.904 million shares. After opening the session at $26.64, the shares went as high as $27.66 and as low as $26.41, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $10.4 billion and now has 375.69 million shares outstanding. The Gap, Inc. (GPS) stock has lost -0.54 percent of market value in 21 trading days.

In last reported earnings results, GPS earned $0.69 per share, better than the $0.68, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $4.09B, better than the $4B analysts expected. Earnings are estimated to increase by 31.8 percent this year, 3.47 percent next year and continue to increase by 10.82 percent annually for the next 5 years. Investors will get their next glimpse of GPS’s Q4 earnings on February 28. Analysts are forecasting revenue to suffer decline of -1.7 percent to $4.7B in the next fiscal quarter, while earnings are seen soaring by nearly 14.75 percent to $0.7 per share. History has shown that shares in The Gap, Inc. have gone up on 17 different earnings reaction days and are predicted to add 0.04 percent when the company reports upcoming earnings.

GPS stock has a trailing 3-year beta of 0.67, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $2.47 a share in the trailing twelve months. The stock’s value has fallen -18.94 percent year to date (YTD) against a decline of -17.14 percent in 12 month’s time. The company’s shares still trade -22.62 percent away from its 1-year high of $35.68 and 13.86 percent up from 52-week low of $24.25. The average consensus rating on the company is 3, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a hold.