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Gap Stock Recovering After Earnings Slide, AI News Helps
Written by Jennifer Ryan Woods. Originally Published: 3/26/2026.
Key Points
- Gap shares have been volatile in recent weeks, falling more than 14% after the company’s early March earnings report before rebounding as investors regained confidence in the retailer’s improving fundamentals.
- The fourth-quarter report showed continued progress in Gap’s turnaround, with 3% comparable sales growth, a second straight year of top-line gains, and a strong balance sheet, although tariff pressure and weakness at the Athleta brand weighed on margins and sentiment.
- Wall Street remains generally optimistic, with a Moderate Buy consensus rating and a $30.62 price target implying about 19% upside, as investors look for the company’s multi-year turnaround strategy to support further gains.
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Gap Inc. (NYSE: GAP) has been a bit of a roller coaster lately. Shares dropped sharply in early March after the company's earnings report, then regained some ground as investors appeared to shrug off the initial reaction and grow more confident in the retailer's improving fundamentals. The stock got another lift this week after reports that Gap plans to integrate its brands into Google's Gemini AI platform, giving Wall Street another reason to be optimistic.
The recent swings underscore how catalyst-driven the stock has become, with shares moving sharply on earnings and headlines as investors assess the company's multi-year turnaround and try to gauge whether the improvements can sustain the rally.
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Click here to find out what it is.Gap has seen plenty of ups and downs over the years. The stock hit a rough patch in 2022 and early 2023 as the company struggled with competition and uneven performance across its brands. Things began to turn around in 2023 after Gap brought in a new CEO and laid out a plan to repair the business. Investors liked what they heard, and the stock started trending higher.
In 2025 and into early 2026, the stock staged another strong run. After hitting a 52-week low near $17 in April 2025, shares climbed steadily as several better-than-expected quarters and stronger performance across much of the portfolio helped lift the stock. By late February 2026, shares were trading near $28, up roughly 70% from the April low.
Fourth-Quarter Earnings Rattle Investors
Things went south on March 5, when the company reported fourth-quarter 2025 results that were slightly below expectations. Earnings of $0.45 per share missed estimates by a penny, while revenue of $4.24 billion was roughly in line with forecasts.
In many respects it was a solid quarter. The company posted its second straight year of top-line growth, with comparable sales up 3%. Gap ended 2025 with about $3 billion in cash — its strongest balance sheet in nearly two decades — allowing it to raise the dividend by about 6% and approve a $1 billion share repurchase program.
There were a few sore spots, though. Tariffs reduced gross margin by roughly 200 basis points during the quarter, and the company's Athleta brand remained weak, with sales down about 11% year over year.
Looking ahead, Gap expects another 150 to 200 basis-point hit from tariffs in the first quarter and anticipates mid-single-digit declines at Athleta in the first half of 2026 as it works to reposition the brand. Even so, its fiscal 2026 guidance exceeded expectations: EPS of $2.20 to $2.35 was above the consensus estimate of $2.15, and revenue of $15.7 billion to $15.9 billion topped the $15.4 billion estimate.
Despite the upbeat full-year outlook, the quarterly report rattled investors and sent shares down more than 14%. The selloff didn't last long, however, and the stock has since moved higher, finishing up in nine of the past 12 trading sessions. Shares are trading around $25, up more than 7% since the earnings report.
AI News Gives the Stock a Boost
Investors got another dose of optimism this week after CNBC reported that shoppers using Gemini to search for clothing will soon be able to buy items directly through the AI platform. That would make Gap the first major fashion retailer to allow consumers to complete checkout without being redirected to the retailer's website. Gap is also testing an AI-based sizing tool designed to help online shoppers select the right fit.
The move comes as retailers look for new ways to leverage AI to drive online sales and keep customers engaged. It's still too early to know how much the AI integration will affect results, but the roughly 3% jump in the stock after the report suggests Wall Street viewed the development favorably.
Wall Street Seems Confident in Gap's Turnaround Plan
Wall Street has been encouraged by the progress of Gap's three-stage turnaround plan. The first phase, which played out over the past two years, focused on fixing the fundamentals. The company says it is now entering the next phase — building momentum — with the final stage aimed at accelerating growth.
So far, the plan appears to be working. Gap posted several better-than-expected quarters in 2024 and 2025, with improving comps, stronger margins, and a healthier balance sheet.
Analysts remain generally optimistic as the company executes its strategy. Gap has a Moderate Buy consensus rating, with 12 Buy ratings and five Holds. Citigroup and JPMorgan raised their price targets after the fourth-quarter report, though Weiss Ratings downgraded the stock to Hold from Buy.
The current 12-month consensus price target of $30.62 implies roughly 22% upside from recent levels. Valuation also suggests potential room for gains: Gap trades at lower multiples than much of the retail industry, with a P/E near 11 versus about 17 for the sector. Its price-to-sales ratio of around 0.62 is also below the industry's roughly 1.12.
While the stock could move higher if fundamentals continue to improve and the turnaround gains traction, the recent pattern of trading on headlines suggests the ride may remain bumpy until Gap can demonstrate more consistent growth.
Branch Out With These Multi-Coin Crypto ETFs
By Nathan Reiff. Posted: 3/30/2026.
Key Points
- Multi-coin ETFs holding as many as 10 different cryptocurrencies in a single portfolio are on the rise, helping to provide built-in diversification for investors not keen to manage several separate crypto holdings.
- Funds like BITW and GDLC offer several crypto holdings in one, with a focus on market capitalization that ensures that Bitcoin remains a substantial part of the portfolio.
- TXBC, on the other hand, targets a basket of 10 cryptos excluding Bitcoin, giving investors access to a large portion of the remainder of the cryptocurrency market without being tied to the largest and most well-known coin.
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Bitcoin has fallen about 44% from its all-time high in October 2025, a drop that has sent some skittish speculators running while prompting longer-term bulls to dig in and reinforce their positions. However, investors who focus solely on the largest digital currency may be missing other opportunities. Although Bitcoin still wields outsized influence over smaller rivals, many competitors — including Ethereum and Solana — no longer always move in lockstep with Bitcoin.
That divergence is another reason investors might consider broadening crypto exposure beyond Bitcoin. Exchange-traded funds (ETFs) tied to alternative digital assets continue to expand, offering an easier way to diversify without buying tokens directly. A relatively new trend, multi-coin ETFs aim to capture a broader slice of the crypto market with a single holding, providing diversification as different tokens can exhibit distinct price behavior at the same time.
A "Crypto Index Fund" Holding 10 Tokens At Once
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Click here to find out what it is.The Bitwise 10 Crypto Index ETF (NYSEARCA: BITW) describes itself as the first "crypto index fund," tracking a portfolio of the 10 largest cryptocurrencies that are rebalanced monthly and weighted by market capitalization. Because of that weighting, Bitcoin occupies a primary position in the basket and currently represents just over three-quarters of the portfolio. Ethereum, XRP, Solana and several smaller tokens make up the remainder.
While BITW's smallest six holdings together account for only a few percent of the overall portfolio, the fund still delivers simultaneous exposure to multiple cryptocurrencies, which can be valuable. It also sometimes trades at a discount to the combined value of its Bitcoin and Ethereum holdings, which can make it more attractive.
Launched late in 2025, BITW has a relatively small asset base (about $700 million) and low trading volume, so it may appeal most to buy-and-hold investors not inclined to track which tokens emerge as contenders over time. Investors seeking that diversification should note BITW's relatively high expense ratio of 2.50%.
A Narrower, But Cheaper, Alternative to BITW
An alternative multi-coin fund that provides a narrower slice of the market, the Grayscale CoinDesk Crypto 5 ETF (NYSEARCA: GDLC) holds five of the largest cryptocurrencies and is rebalanced quarterly.
Bitcoin again represents roughly three-quarters of GDLC's portfolio, followed by Ethereum. Altcoins — including BNB, XRP and Solana — collectively account for almost 12% of the basket, which may suit investors seeking slightly greater exposure to non-Bitcoin, non-Ethereum coins.
Quarterly rebalancing may be less attractive to investors trying to chase the very latest crypto trends, though in practice Bitcoin and Ethereum are likely to remain core components for the foreseeable future. GDLC's expense ratio of 0.59% is substantially lower than BITW's, so some investors may prefer paying that smaller fee in exchange for less breadth and less-frequent rebalancing.
No Bitcoin, No Problem: TXBC Bets on the Rest of Crypto
For investors who want multi-coin exposure without Bitcoin, the 21Shares FTSE Crypto 10 ex-BTC Index ETF (NYSEARCA: TXBC) offers an alternative. The fund holds the 10 largest cryptocurrencies by market capitalization excluding Bitcoin, and it rebalances quarterly.
With Bitcoin excluded, Ethereum becomes the largest position in TXBC's portfolio, occupying just under half. Binance Coin, XRP and Solana receive meaningful weightings of roughly 10% or more each. The remaining coins have smaller allocations, but generally larger weights than those of BITW's smallest holdings.
TXBC's lack of reliance on Bitcoin means its performance can diverge from Bitcoin-focused funds. Since launching in November 2025, the fund has fallen by about a third, but investors who expect another broad crypto rally may find TXBC a useful complement to a separate Bitcoin or Bitcoin-focused ETF holding. Linked to an underlying index, TXBC maintains a modest expense ratio of 0.65%.
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