Abercrombie and Fitch has been treading water for the past six months, recording a small return of 2.5% while holding steady at $97.45. The stock also fell short of the S&P 500’s 8.1% gain during that period.

Does this present a buying opportunity for ANF? Or is its underperformance reflective of its story and business quality? Find out in our full research report, it’s free.

Why Are We Positive On ANF?

Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.

1. Surging Same-Store Sales Show Increasing Demand

Same-store sales show the change in sales for a retailer's e-commerce platform and brick-and-mortar shops that have existed for at least a year. This is a key performance indicator because it measures organic growth.

Abercrombie and Fitch has been one of the most successful retailers over the last two years thanks to skyrocketing demand within its existing locations. On average, the company has posted exceptional year-on-year same-store sales growth of 11.9%.

2. Elite Gross Margin Powers Best-In-Class Business Model

Gross profit margins are an important measure of a retailer’s pricing power, product differentiation, and negotiating leverage.

Abercrombie and Fitch has best-in-class unit economics for a retailer, enabling it to invest in areas such as marketing and talent. As you can see below, it averaged an elite 63.3% gross margin over the last two years. That means Abercrombie and Fitch only paid its suppliers $36.66 for every $100 in revenue.

3. Outstanding Long-Term EPS Growth

We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.

Abercrombie and Fitch’s EPS grew at an astounding 189% compounded annual growth rate over the last three years, higher than its 12.3% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Final Judgment

These are just a few reasons Abercrombie and Fitch is a high-quality business worth owning. With its shares trailing the market in recent months, the stock trades at 9.7× forward P/E (or $97.45 per share). Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

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The names generating the next wave of massive growth are right here in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.