Abercrombie & Fitch (ANF) Price Target Trimmed by Raymond James Amid Tariff Concerns

Raymond James analyst Rick Patel updated his price target for Abercrombie & Fitch Co. (NYSE:ANF) from $110 to $90 on May 27 while maintaining an Outperform rating on the company's shares. Given the noted flaws in the A&F brand and the expected effects of tariffs, the change represents a cautious approach.

Patel's investigation encompassed several variables, including weekly online advertising, Google Trends, and data from mobile apps. According to the results, the A&F brand saw a decrease in most checks quarter-over-quarter, although promotions rose in Q1. On the other hand, Abercrombie & Fitch's Hollister brand performed better in the majority of tests.

Abercrombie & Fitch Co. (NYSE:ANF) is expected to encounter substantial tariff headwinds, estimated at about 200 basis points annually, the analyst said. Patel expressed little confidence in ANF's ability to raise prices successfully due to its younger customer base, despite the company's expected use of mitigation strategies similar to those employed by other Softlines companies.

With that said, the analyst concluded that the stock price already appears to reflect a significant portion of the unfavorable news. Long-term growth and margin expansion levers are still available, Patel said.

While we acknowledge the potential of ANF to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ANF and that has 100x upside potential, check out our report about the cheapest AI stock.

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