Will improving sales help Abercrombie & Fitch's figures?

The US clothing retailer will be hoping that further global expansion will help the company tap into South American sales. 

Shopper holding an Abercrombie & Fitch bag
Source: Bloomberg

On Wednesday 3 December Abercrombie & Fitch, the US clothing retailer, is due to post its third-quarter figures. Markets are expecting the adjusted earnings per share to jump from 19 cents up to 41.1 cents. Sales for the US clothing retailer are expected to increase from $890.605 million up to $911million and pre-tax profit is called to jump from $17.473 million up to $49.061 million.

These third-quarter figures come out just after the very important Black Friday in the US. Black Friday is the day after Thanksgiving and has historically been seen as the start of the festive period sales drive.

Although the vast majority of the company’s revenue comes from within the US, the firm has been keen to expand its global reach. The company currently has over 830 stores in the US and almost 170 stores in Canada, Asia, Australia, the Middle East and Europe. Breaking with tradition, Abercrombie & Fitch is now looking at franchising in Mexico with the aim of having stores set up in four major Mexican cities by the end of 2015.

Year-on-year shares in the company are down 14%, but off by over 34% from the August highs of $45.10. It will take more than just a decent set of third-quarter figures to encourage the markets to retest these levels. 

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by analysts

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.