Gap's Stock Rallies As Upbeat Profit Outlook Offsets Disappointing Sales

Gap Inc.'s stock jumped 4.2% in after-hours trade Thursday after the apparel retailer's upbeat profit outlook overshadowed weaker-than-expected sales results. Gap said it expects fiscal third-quarter earnings per share to rise to range of 78 cents to 79 cents from 72 cents a year ago, compared with the FactSet consensus analyst estimate of a decline to 71 cents. Meanwhile, Gap said net sales for the quarter fell to $3.97 billion from $3.98 billion a year ago, and same-store sales declined 2%, compared with analyst forecasts of $4.06 billion and a decline of 0.9%, respectively. The stock has lost 3% so far this year through Thursday, compared with a 1.8% rise in the SPDR S&P Retail ETF and a 9.9% gain in the S&P 500.