Based on the aggregated intelligence of 135,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, teen clothing retailer Abercrombie & Fitch (NYSE: ANF ) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Abercrombie's business and see what CAPS investors are saying about the stock right now.
Abercrombie & Fitch facts
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Headquarters (founded)
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New Albany, Ohio (1892)
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Market Cap
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$2.64 billion
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Industry
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Apparel Retail
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TTM Revenue
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$3.35 billion
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Management
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CEO Michael Jeffries (since 1992)
CFO Jonathan Ramsden (since 2008)
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Return on Equity (average, last five years and TTM)
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28.9% and 8.8%
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6-Month Return
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68%
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Competitors
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American Eagle (NYSE: AEO )
Gap (NYSE: GPS )
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CAPS members bearish on ANF also bearish on
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Sears Holdings (Nasdaq: SHLD )
Ford (NYSE: F )
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CAPS members bullish on ANF also bullish on
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Microsoft (Nasdaq: MSFT )
Google (Nasdaq: GOOG )
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Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.
Over on CAPS, 222 of the 1,054 members who have rated Abercrombie -- 21% -- believe the stock will underperform the S&P 500 going forward. These bears include Prodders and TheGouch23.
Just last week, Prodders urged Fools to try something else on for size: "Consumer is retrenching and will remain thriftier going forward. Plenty of cheaper alternatives, both stocks and clothes."
In a pitch from two weeks earlier, TheGouch23 also thinks the stock is simply worn out:
Abercrombie's appeal has run its course. Its blunders of the past, such as racially insensitive designs, promoting a culture of "beautiful people", and changing from a good albeit expensive store for kids a decade ago to an elitist culture of rich teen snobbery, the brand does not have the same connotations it used to. … Potential consumers are realizing that it's easier to pay $30 for a pair of jeans they can beat up themselves than $50 for a pair that Abercrombie has beat up for them.
The combination of these trends, and [Abercrombie's] "wandering in the dark" leadership, make it unlikely the company will outperform the S&P, and all the more likely its numbers will struggle. And investors will take note.
What do you think about Abercrombie, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 135,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.
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