Gap’s stock falls 7.5% premarket after Q1 results late Thursday

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Gap stock jumps 8% on better Q4 sales, 2018 outlook

Shares of Gap Inc. rose 8% late Thursday after the retailer posted better-than-expected fourth-quarter sales and said its comparable-store sales rose in 2017. Gap earned $205 million, or 52 cents a share, in the quarter, which includes $34 million of provisional net tax impacts related to the U.S. tax overhaul and compares with $220 million, or 55 cents a share, in the year-ago period. Adjusted for one-time items, the company earned 61 cents a share, compared with 51 cents a share a year ago. Revenue rose 8% to $4.8 billion in the quarter, compared with $4.4 billion a year ago. Analysts polled by FactSet had expected GAAP and adjusted earnings of 58 cents a share on sales of $4.7 billion. Comparable-store sales were up 5%, with sales at Old Navy rising 9%. Gap said it expects diluted earnings per share to be in the range of $2.55 to $2.70 in fiscal 2018, and forecasts comparable sales for the year to be flat to up slightly. The analysts surveyed by FactSet expect EPS of $2.10 for 2018. In a separate statement, Gap said it was increasing its annual dividend by more than 5% to 97 cents a share. The board of directors has authorized a first-quarter dividend of 24.25 cents a share, payable May 2 to shareholders of record on April 11. Gap shares ended the regular trading session up 0.4%.

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