What Happened?
Shares of young adult apparel retailer Abercrombie & Fitch (NYSE:ANF) jumped 9.4% in the afternoon session after data from Adobe Analytics, which tracks retail transactions, revealed that shoppers spent a record $10.8 billion online on Black Friday (2024), representing more than a 10% growth compared to the previous year, and more than double what consumers spent in 2017.
This is a bullish 'read-through' for retailers and aligns with some of the positive sentiments and holiday spending trends observed by some of the companies that have reported this earnings season.
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What The Market Is Telling Us
Abercrombie and Fitch’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 10 days ago when the stock gained 6.1% on the news that fellow clothing brand Gap reported strong third-quarter results that blew past analysts' profits and earnings expectations. The improved results and observations of strong demand heading into the holiday season helped Gap raise its sales forecast for the fiscal year. This positive trend likely influenced investor sentiment toward peers such as V.F. Corporation (VFC) and Abercrombie & Fitch (ANF), which are also positioned to benefit from strong spending in apparel.
Abercrombie and Fitch is up 73.4% since the beginning of the year, but at $157.71 per share, it is still trading 18% below its 52-week high of $192.34 from June 2024. Investors who bought $1,000 worth of Abercrombie and Fitch’s shares 5 years ago would now be looking at an investment worth $9,599.
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