GAP INC/THE (GAP) Stock Fundamental Analysis
NYSE:GAP - US3647601083 - Common Stock
22.61 USD
-0.01 (-0.04%)
Overall GAP gets a fundamental rating of 5 out of 10. We evaluated GAP against 123 industry peers in the Specialty Retail industry. GAP has an excellent profitability rating, but there are some minor concerns on its financial health. GAP scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
GAP had positive earnings in the past year.
In the past year GAP had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: GAP reported negative net income in multiple years.
In the past 5 years GAP always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of GAP (7.32%) is better than 78.86% of its industry peers.
With an excellent Return On Equity value of 25.90%, GAP belongs to the best of the industry, outperforming 84.55% of the companies in the same industry.
GAP's Return On Invested Capital of 10.73% is fine compared to the rest of the industry. GAP outperforms 76.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.32% | ||
| ROE | 25.9% | ||
| ROIC | 10.73% |
ROA(3y)3.29%
ROA(5y)1.41%
ROE(3y)12.05%
ROE(5y)4.02%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
GAP has a better Profit Margin (5.86%) than 81.30% of its industry peers.
GAP's Profit Margin has improved in the last couple of years.
The Operating Margin of GAP (7.69%) is better than 78.86% of its industry peers.
In the last couple of years the Operating Margin of GAP has grown nicely.
The Gross Margin of GAP (41.09%) is better than 65.04% of its industry peers.
GAP's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.69% | ||
| PM (TTM) | 5.86% | ||
| GM | 41.09% |
OM growth 3Y11.89%
OM growth 5Y5.36%
PM growth 3Y53.87%
PM growth 5Y21.16%
GM growth 3Y1.21%
GM growth 5Y1.97%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), GAP is creating some value.
Compared to 1 year ago, GAP has more shares outstanding
Compared to 5 years ago, GAP has more shares outstanding
The debt/assets ratio for GAP has been reduced compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of GAP is 1.94, which is an excellent value as it means it would take GAP, only 1.94 years of fcf income to pay off all of its debts.
GAP has a better Debt to FCF ratio (1.94) than 77.24% of its industry peers.
GAP has a Debt/Equity ratio of 0.43. This is a healthy value indicating a solid balance between debt and equity.
GAP's Debt to Equity ratio of 0.43 is in line compared to the rest of the industry. GAP outperforms 52.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 1.94 | ||
| Altman-Z | N/A |
ROIC/WACC1.17
WACC9.17%
2.3 Liquidity
A Current Ratio of 1.68 indicates that GAP should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.68, GAP is doing good in the industry, outperforming 73.98% of the companies in the same industry.
GAP has a Quick Ratio of 1.68. This is a bad value and indicates that GAP is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Quick ratio value of 0.96, GAP is doing good in the industry, outperforming 77.24% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.68 | ||
| Quick Ratio | 0.96 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 15.27% over the past year.
GAP shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.22% yearly.
The Revenue has decreased by -0.05% in the past year.
The Revenue has been decreasing by -1.64% on average over the past years.
EPS 1Y (TTM)15.27%
EPS 3Y15.62%
EPS 5Y2.22%
EPS Q2Q%5.56%
Revenue 1Y (TTM)-0.05%
Revenue growth 3Y-3.27%
Revenue growth 5Y-1.64%
Sales Q2Q%0.13%
3.2 Future
The Earnings Per Share is expected to grow by 5.43% on average over the next years.
The Revenue is expected to grow by 1.65% on average over the next years.
EPS Next Y-1.86%
EPS Next 2Y1.6%
EPS Next 3Y3.66%
EPS Next 5Y5.43%
Revenue Next Year2.08%
Revenue Next 2Y2.08%
Revenue Next 3Y1.94%
Revenue Next 5Y1.65%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.66, the valuation of GAP can be described as reasonable.
Based on the Price/Earnings ratio, GAP is valued cheaply inside the industry as 86.99% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of GAP to the average of the S&P500 Index (26.90), we can say GAP is valued rather cheaply.
With a Price/Forward Earnings ratio of 9.91, the valuation of GAP can be described as very reasonable.
Based on the Price/Forward Earnings ratio, GAP is valued cheaply inside the industry as 86.18% of the companies are valued more expensively.
GAP is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.52, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.66 | ||
| Fwd PE | 9.91 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GAP is valued cheaper than 91.06% of the companies in the same industry.
GAP's Price/Free Cash Flow ratio is rather cheap when compared to the industry. GAP is cheaper than 85.37% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.97 | ||
| EV/EBITDA | 4.37 |
4.3 Compensation for Growth
The decent profitability rating of GAP may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)4.35
EPS Next 2Y1.6%
EPS Next 3Y3.66%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.00%, GAP has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 5.41, GAP pays a better dividend. On top of this GAP pays more dividend than 89.43% of the companies listed in the same industry.
GAP's Dividend Yield is a higher than the S&P500 average which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
5.2 History
The dividend of GAP decreases each year by -9.10%.
GAP has paid a dividend for at least 10 years, which is a reliable track record.
GAP has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-9.1%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
26.55% of the earnings are spent on dividend by GAP. This is a low number and sustainable payout ratio.
DP26.55%
EPS Next 2Y1.6%
EPS Next 3Y3.66%
NYSE:GAP (9/3/2025, 10:39:10 AM)
22.61
-0.01 (-0.04%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners64.35%
Inst Owner ChangeN/A
Ins Owners39.16%
Ins Owner Change40.26%
Market Cap8.44B
Analysts70.43
Price Target24.34 (7.65%)
Short Float %9.41%
Short Ratio2.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
Yearly Dividend0.6
Dividend Growth(5Y)-9.1%
DP26.55%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.08%
Min EPS beat(2)2.72%
Max EPS beat(2)11.43%
EPS beat(4)4
Avg EPS beat(4)20.51%
Min EPS beat(4)2.72%
Max EPS beat(4)44.45%
EPS beat(8)8
Avg EPS beat(8)77.43%
EPS beat(12)11
Avg EPS beat(12)10182.5%
EPS beat(16)13
Avg EPS beat(16)7651.75%
Revenue beat(2)1
Avg Revenue beat(2)-0.53%
Min Revenue beat(2)-1.3%
Max Revenue beat(2)0.23%
Revenue beat(4)2
Avg Revenue beat(4)-0.19%
Min Revenue beat(4)-1.3%
Max Revenue beat(4)0.85%
Revenue beat(8)6
Avg Revenue beat(8)0.91%
Revenue beat(12)7
Avg Revenue beat(12)0.49%
Revenue beat(16)7
Avg Revenue beat(16)-0.43%
PT rev (1m)-6.19%
PT rev (3m)-3.67%
EPS NQ rev (1m)0.8%
EPS NQ rev (3m)-1.15%
EPS NY rev (1m)-2.54%
EPS NY rev (3m)-5%
Revenue NQ rev (1m)0.11%
Revenue NQ rev (3m)0.29%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)0.66%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.66 | ||
| Fwd PE | 9.91 | ||
| P/S | 0.56 | ||
| P/FCF | 10.97 | ||
| P/OCF | 6.94 | ||
| P/B | 2.46 | ||
| P/tB | 2.46 | ||
| EV/EBITDA | 4.37 |
EPS(TTM)2.34
EY10.35%
EPS(NY)2.28
Fwd EY10.09%
FCF(TTM)2.06
FCFY9.12%
OCF(TTM)3.26
OCFY14.4%
SpS40.65
BVpS9.2
TBVpS9.2
PEG (NY)N/A
PEG (5Y)4.35
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.32% | ||
| ROE | 25.9% | ||
| ROCE | 13.04% | ||
| ROIC | 10.73% | ||
| ROICexc | 14.73% | ||
| ROICexgc | 14.73% | ||
| OM | 7.69% | ||
| PM (TTM) | 5.86% | ||
| GM | 41.09% | ||
| FCFM | 5.07% |
ROA(3y)3.29%
ROA(5y)1.41%
ROE(3y)12.05%
ROE(5y)4.02%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y18.13%
ROICexcg growth 5Y12.19%
ROICexc growth 3Y17.89%
ROICexc growth 5Y11.77%
OM growth 3Y11.89%
OM growth 5Y5.36%
PM growth 3Y53.87%
PM growth 5Y21.16%
GM growth 3Y1.21%
GM growth 5Y1.97%
F-Score8
Asset Turnover1.25
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | 1.94 | ||
| Debt/EBITDA | 0.9 | ||
| Cap/Depr | 89.92% | ||
| Cap/Sales | 2.94% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.06% | ||
| Profit Quality | 86.5% | ||
| Current Ratio | 1.68 | ||
| Quick Ratio | 0.96 | ||
| Altman-Z | N/A |
F-Score8
WACC9.17%
ROIC/WACC1.17
Cap/Depr(3y)98.9%
Cap/Depr(5y)102.35%
Cap/Sales(3y)3.39%
Cap/Sales(5y)3.43%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)15.27%
EPS 3Y15.62%
EPS 5Y2.22%
EPS Q2Q%5.56%
EPS Next Y-1.86%
EPS Next 2Y1.6%
EPS Next 3Y3.66%
EPS Next 5Y5.43%
Revenue 1Y (TTM)-0.05%
Revenue growth 3Y-3.27%
Revenue growth 5Y-1.64%
Sales Q2Q%0.13%
Revenue Next Year2.08%
Revenue Next 2Y2.08%
Revenue Next 3Y1.94%
Revenue Next 5Y1.65%
EBIT growth 1Y19.57%
EBIT growth 3Y8.23%
EBIT growth 5Y3.64%
EBIT Next Year56.18%
EBIT Next 3Y18.42%
EBIT Next 5Y10.59%
FCF growth 1Y-11%
FCF growth 3Y108.28%
FCF growth 5Y23.2%
OCF growth 1Y-9.46%
OCF growth 3Y22.47%
OCF growth 5Y1.04%