Abercrombie & Fitch Co. (NYSE:ANF) logged its eighth straight quarter of dwindling sales and continues to face headwinds in its effort to recover the brands prominence with young people and status seekers. The company has blamed everything from a strong dollar to a failure of its logo line as the reasons for the chronic decline of the brand. They also noted a highly competitive holiday season that forced them to slash prices in order to remain competitive with rivals such as American Eagle brand.
Many had blamed bad leadership for the company’s struggles and that resulted in the former CEO, Mike Jefferies, stepping down from his position. The company has not yet named a successor and this might not be the job any sane professional would be interested in. Analysts seem to agree and the overall opinion is that the company has gone so long without strong leadership that even the company’s branded and logo apparel is no longer enticing customers. In the recent past, the company had blamed poor sales of its logo apparel but has yet to stop flooding its inventory with the dead merchandise.
The Abercrombie & Fitch Co. (NYSE:ANF) has also blamed currency valuations on the poor performance. This elicited chuckles from the retail community as even with fluctuations in the FOREX, the top-line number should not be affected, and rather the bottom-line number should. This again turned the focus to leadership, or the lack of it. It has been eight reporting periods and the company has made no significant changes to improving sales and its competitors such as American Eagle are seeing steady growth. No strategy has been discussed by the company in recent conference calls and this raises concerns there is no viable plan to turn the business around.
The stock is at 52-week lows and there are no bright spots to the chart. With no clear plan going forward there isn’t much to excite traders and until some direction for the model is established, the stock will continue to struggle.