Zacks Picks Abercrombie as Bull of the Day Blue Bird as Bear
Zacks Equity Research has identified Abercrombie & Fitch (ANF) as its Bull of the Day and Blue Bird (BLBD) as its Bear of the Day. The analysis also covers Walmart (WMT), Target (TGT), and Dollar General (DG).
Abercrombie & Fitch, a Zacks Rank #1 (Strong Buy), is highlighted for its impressive turnaround. Despite earlier predictions of its demise due to the decline of traditional retail, the company has thrived by enhancing its omnichannel presence and offering a unique customer experience. The company's fiscal 2027 earnings are projected at $13.23 per share, up from $9.86 last year, with a 2.8% increase in estimates over the past four weeks. Recent quarterly results exceeded expectations, with EPS of $2.42 compared to the estimated $1.95, and revenue of $1.27 billion. Management has raised its full-year outlook, anticipating 5% sales growth and an operating margin of 14.5% to 15%. Additionally, Abercrombie has repurchased $282 million worth of stock, reducing shares outstanding by 7%, with plans for at least $500 million in share repurchases for the full year.
Blue Bird, a Zacks Rank #5 (Strong Sell), is identified as the Bear of the Day. Despite initial excitement about the transition to electric school buses, the company's earnings estimates have declined significantly. Over the past two months, next-year earnings estimates dropped from $5.23 to $4.40 per share, a 16% decrease. Both analysts covering the stock have reduced their estimates, indicating potential turbulence ahead. Although current-year earnings estimates have improved slightly, the stock price has fallen, closing at $55.60 on October 2, well below its 52-week high of $83.39.
Zacks Equity Research also provides insights into how Walmart, Target, and Dollar General have benefited from tariff refunds. Walmart received approximately $2.9 billion in tariff refunds, contributing to stronger margins and customer-focused pricing initiatives. Target recorded $994 million in tariff refunds, boosting its gross margin and operating results. These refunds have allowed the companies to strengthen their competitive positioning and invest in customer experience.