Abercrombie & Fitch Remains Well Positioned to Generate Sustainable Growth, UBS Says

12:53 PM EDT, 08/27/2026 (MT Newswires) -- Abercrombie & Fitch (ANF) remains well positioned to generate sustainable growth through product innovation, category expansion, inventory management, as well as a greater international footprint, UBS Securities said in a research note. Building on this, the investment firm projected a 13% five-year EPS compound annual growth rate, and said that the company's current earnings power is supported by mid-single digit percentage sales growth, higher gross margin, and increased cash returns to shareholders. Additionally, sales of the Hollister brand have accelerated in Q3-to-date from Q2 levels on account of timely inventory replenishment, UBS said in a note Wednesday, adding that this should support sales growth improvement in H2. UBS further said that while Abercrombie & Fitch has benefitted from tariff refunds, the company's gross margin upside in Q2 was aided by better-than-expected average selling prices per unit and reduced promotional activity, indicating resilient merchandise margins despite the tariff environment. UBS raised its price target to $185 from $153 and maintained its buy rating. Price: 148.17, Change: +0.42, Percent Change: +0.28