2025 hasn’t gone smoothly for Abercrombie & Fitch (ANF), with the stock spending much of the year in negative territory. Weighing on performance were multiple headwinds, including persistent concerns about whether the company’s gross margins could be sustained, broader market jitters tied to tariff threats, and speculation surrounding shifting consumer trends. With all that in play, investors had little reason for optimism until a surprisingly strong earnings report flipped the script.

Shares of the apparel retailer took off after Abercrombie’s latest results delivered an unexpected jolt, with both revenue and earnings coming in ahead of expectations. Interestingly, what stood out was the market’s reaction. Investors largely shrugged off the company's tempered full-year outlook for earnings and margins, instead focusing on its resilient performance amid tariff uncertainty. So, with the stock staging a powerful comeback, is now the right time to jump in? 

About Abercrombie & Fitch Stock

Ohio-based Abercrombie & Fitch (ANF) is a global apparel retailer with a digital-first, omnichannel approach, targeting a broad range of customers from kids to millennials. Through its Abercrombie and Hollister brand families, the company offers lifestyle-focused clothing and accessories. With around 790 stores across North America, Europe, Asia, and the Middle East, alongside a strong online presence, Abercrombie maintains a wide-reaching retail footprint.

Valued at around $4.2 billion by market cap, Abercrombie & Fitch has had a rough run in 2025, with its stock tumbling nearly 44%, heavily underperforming the marginal gains of the broader S&P 500 Index ($SPX). But after months in the red, the stock is showing signs of life. In just the past month, shares have surged 21%, hinting at a possible comeback after a bruising start to the year.

Valuation-wise, Abercrombie looks notably discounted. The stock curretly trades at just 7.25 times forward earnings, well below the sector median of 16.26x and far beneath its own five-year average of 29.58x. The gap points to a market that’s still skeptical, even as signs of a turnaround begin to emerge.

Digging Into Abercrombie & Fitch’s Q1 Earnings 

On May 28, Abercrombie pulled back the curtains on its first quarter earnings report, which triggered a sharp 14.7% surge on the very same day. The retailer posted record first-quarter sales of $1.1 billion, an 8% increase year-over-year that edged past analyst estimates. While earnings per share fell 25.7% to $1.59, the result still beat Wall Street’s forecast of $1.35, giving investors reason to cheer.

Digging into the details, the Hollister brand was the standout performer, delivering a 22% surge in sales and logging its best-ever Q1 revenue. In contrast, the namesake Abercrombie brand saw a 4% decline in net sales. Still, the overall growth narrative remained intact, with Hollister’s strength more than offsetting the weakness in other areas. In a show of confidence, the company repurchased roughly $200 million worth of shares during the quarter. 

With $1.1 billion left under its repurchase plan announced in March 2025, Abercrombie is clearly not shying away from rewarding shareholders, even as pressure on margins looms. Abercrombie’s blowout quarter sent the stock soaring, with investors choosing to ride the wave of strong results rather than dwell on the company’s lowered full-year earnings and margin forecasts.

For fiscal 2025, management lowered its full-year EPS guidance to a range of $9.50 to $10.50, down from its prior view of $10.40 to $11.40. Operating margin expectations were also trimmed to 12.5% to 13.5% from a previous 14% to 15%. The downgrade largely reflects the expected $50 million hit from tariffs, which are poised to eat into the company’s profitability in the coming quarters.

Despite the softer margin and profit outlook, Abercrombie raised its full-year revenue guidance slightly, now calling for growth of 3% to 6%, up from 3% to 5%. Meanwhile, analysts tracking Abercrombie & Fitch project the company’s earnings to dip 4% to $10.26 per share in fiscal 2025, before rebounding with a 5.6% climb to $10.83 per share in fiscal 2026. 

What Do Analysts Expect for Abercrombie & Fitch Stock? 

Wall Street is showing faith in ANF stock, with the consensus leaning toward an optimistic “Moderate Buy” rating overall. Of the 10 analysts offering recommendations, five give it a solid “Strong Buy,” one suggests a “Moderate Buy,” and the remaining four give a “Hold.” 

The average analyst price target of $108.62 indicates 30% potential upside from the current price levels. The Street-high price target of $142 suggests that ANF could rally as much as 71% from here.