Results: Abercrombie & Fitch Co. Exceeded Expectations And The Consensus Has Updated Its Estimates

A week ago, Abercrombie & Fitch Co. (NYSE:ANF) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 2.7% to hit US$1.2b. Abercrombie & Fitch reported statutory earnings per share (EPS) US$2.50, which was a notable 12% above what the analysts had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Abercrombie & Fitch

Taking into account the latest results, the consensus forecast from Abercrombie & Fitch's nine analysts is for revenues of US$5.22b in 2026. This reflects a decent 8.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to decrease 6.9% to US$9.79 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$5.18b and earnings per share (EPS) of US$9.58 in 2026. So the consensus seems to have become somewhat more optimistic on Abercrombie & Fitch's earnings potential following these results.

There's been no major changes to the consensus price target of US$187, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Abercrombie & Fitch, with the most bullish analyst valuing it at US$220 and the most bearish at US$149 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2026 brings more of the same, according to the analysts, with revenue forecast to display 6.6% growth on an annualised basis. That is in line with its 6.6% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 4.7% annually. So although Abercrombie & Fitch is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Abercrombie & Fitch following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Abercrombie & Fitch going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Abercrombie & Fitch that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.