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Gap, Inc. (The) (GAP) Stock Analysis

Falling Knife setup · Catalyst-Driven edge

SellVALUE-TRAP 2/5High Confidence

Consumer Cyclical · Apparel Retail

Sell if holding. Momentum 2.0/10 is below the 5.0 floor at $20.92 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: V7 low-quality RISK_OFF penalty: -0.5 (Q=5.1); Sector modifier (Consumer Cyclical): -1.5.

Gap Inc. is a global omni-channel apparel retailer operating Old Navy, Gap, Banana Republic, and Athleta brands through 2,474 company-operated stores and ~1,000 franchise locations. Almost all products are manufactured outside North America; Vietnam (27%) and Indonesia (21%) are... Read more

$20.92+30.8% A.UpsideScore 4.8/10#12 of 12 Apparel Retail
QualityF-score7 / 9FCF yield9.24%
IncomeYield3.37%(5y avg 3.50%)Payout30.99%sustainable
Stop $19.45Target $27.19(analyst − 10%)A.R:R 3.9:1
Analyst target$30.21+44.4%17 analysts
$27.19our TP
$20.92price
$30.21mean
$41

Sell if holding. Momentum 2.0/10 is below the 5.0 floor at $20.92 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: V7 low-quality RISK_OFF penalty: -0.5 (Q=5.1); Sector modifier (Consumer Cyclical): -1.5. Chart setup: Death cross, below all MAs, RSI 24, MACD bearish. Score 4.8/10, high confidence.

Passes 6/8 gates (favorable risk/reward ratio, clean insider activity, no SEC red flags, news boost analyst cluster(3), semi cycle peak clear, materials cycle peak clear). Fails on weak momentum. Suitability: aggressive.

Recent Developments — Gap, Inc. (The)

Generated 2026-05-20T21:06:21Z.

Thesis

Rewards
Strong earnings beat streak (3/4)
Attractive valuation
Margin of safety: 35%
Risks
V7 low-quality RISK_OFF penalty: -0.5 (Q=5.1)
Sector modifier (Consumer Cyclical): -1.5
Leverage penalty (D/E 1.5): -0.5

Key Metrics

P/E (TTM)9.8
P/E (Fwd)8.0
Mkt Cap$7.6B
EV/EBITDA6.5
Profit Mgn5.3%
ROE23.1%
Rev Growth2.1%
Beta2.08
Dividend3.37%
Rating analysts24

Quality Signals

Piotroski F7/9MoatNarrow

Options Flow

P/C1.35bearish
IV81%elevated
Max Pain$32+53.0% vs spot

Concentration Risks(10-K Item 1A)

  • MEDIUMSupplierVietnam27%
    10-K Item 1: 'Approximately 27 percent of our fiscal 2025 purchases, by dollar value, were from factories in Vietnam.'
  • LOWSupplierIndonesia21%
    10-K Item 1: 'Approximately 21 percent of our fiscal 2025 purchases, by dollar value, were from factories in Indonesia.'

Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. Full disclaimer

Rating Breakdown

2 floor-breakers

Growth below the gate floor. Component breakdown shows what dragged the score down.static

Earnings Growth
0.0
Revenue Growth
3.0

Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static

Macd
0.0
Obv
1.1
Ma Position
2.2
Rsi
3.0
Volume
3.9
Capitulation risk (RSI 24, below 200MA)Volume distribution (falling OBV)Below 200-MA but MA still rising (+2.2%/30d) — pullback in uptrend, not confirmed weakness
GatesMomentum 2.0<4.5EARNINGS PROXIMITY 8d<=14d (soft)A.R:R 3.9 ≥ 1.5Insider activity: OKNo SEC red flagsNEWS BOOST ANALYST CLUSTER(3)SEMI CYCLE PEAK CLEARMATERIALS CYCLE PEAK CLEARFalling KnifeSuitability: Aggressive
RSI
24 · Oversold
20D MA 50D MA 200D MADEATH CROSSSupport $20.05Resistance $26.87

Price Targets

$19
$27
A.Upside+30.0%
A.R:R3.9:1

Position Sizing

ConvictionNone
Suggested %0.5%
Max %1%
RegimeRisk-Off

Risk Alerts

! Momentum score 2.0/10 — below 4.5 minimum

Earnings

B
B
B
M
3/4 beats
Next Earnings2026-05-28 (8d)

Verdict History

reverse chrono — latest first
Loading history...
Verdicts are recorded on every nightly pipeline run. Rows capture transitions (verdict flips, score deltas ≥0.3, entry/TP/SL changes). Rows with a ▶ can be expanded to see the change reason. Aggregate cohort performance is tracked in the recommendation ledger.
Frequently Asked Questions
Is GAP stock a buy right now?

Sell if holding. Momentum 2.0/10 is below the 5.0 floor at $20.92 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: V7 low-quality RISK_OFF penalty: -0.5 (Q=5.1); Sector modifier (Consumer Cyclical): -1.5. Chart setup: Death cross, below all MAs, RSI 24, MACD bearish. Prior stop was $19.45. Score 4.8/10, high confidence.

What is the GAP stock price target?

Take-profit target: $27.19 (+30.8% upside). Prior stop was $19.45. Stop-loss: $19.45.

What are the risks of investing in GAP?

V7 low-quality RISK_OFF penalty: -0.5 (Q=5.1); Sector modifier (Consumer Cyclical): -1.5; Leverage penalty (D/E 1.5): -0.5.

Is GAP overvalued or undervalued?

Gap, Inc. (The) trades at a P/E of 9.8 (forward 8.0). TrendMatrix value score: 8.4/10. Verdict: Sell.

What do analysts say about GAP?

24 analysts cover GAP with a consensus score of 4.0/5. Average price target: $30.

What does Gap, Inc. (The) do?Gap Inc. is a global omni-channel apparel retailer operating Old Navy, Gap, Banana Republic, and Athleta brands through...

Gap Inc. is a global omni-channel apparel retailer operating Old Navy, Gap, Banana Republic, and Athleta brands through 2,474 company-operated stores and ~1,000 franchise locations. Almost all products are manufactured outside North America; Vietnam (27%) and Indonesia (21%) are the two largest sourcing countries by purchase value.

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