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GAP and Pacific Sunwear of California, Inc

ARP Project

Jonathan Kemp

on 21 April 2010

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Transcript of GAP and Pacific Sunwear of California, Inc

Double click anywhere & add an idea ARP on Gap Inc, and Pacific Sunwear of California, Inc
Omar Fitzgerald
William Gladden
Penny Dyar
Amy Marshall
Jonathan Kemp
Gap, Inc is located in Delaware.

-It was founded in 1969 in San Francisco, California.

The component of the mission statement that stands out the most is Gaps goal to…“Simply, to make it easy for you to express your personal style throughout your life.”
Gap Inc. operates 3,095 stores worldwide. GaP has stores throughout the United States, as well as in Canada, the United Kingdom, France, Ireland and Japan. More than 134,000 employees around the world support Gap Inc. and its brands.
With 2009 Net Sales by Division: Gap North America: $3.8 billion, Banana Republic North America: $2.2 billion, Old Navy: $5.3 billion, International: $1.6 billion and Gap Inc. Direct (online): $1.1 billion
Products by GAP, Inc
The Gap: Gap continues to be the best destination for wardrobe essentials such as T-shirts, hoodies, great-fitting pants and denim. What began as one brand has grown to include Gap, Gap Kids, baby Gap, Gap Maternity and gap body. These clothing lines serve from babies to adults in age from infants to middle age.
The brand offers elevated essentials and sophisticated seasonal collections of accessories, shoes, personal care products and intimate apparel. From work to casual occasions, Banana Republic offers covetable, uncomplicated style. The nique of clothing serves the age range from preteen, young adults to adults.

has been famous for bringing customers on-trend apparel and accessories, as well as updated basics, at a surprising value, all in a fun, energizing shopping environment. The old Navy brand is set for kids to preteen, young adults to adult age.

Piperlime shares fresh tips on the latest shoe and handbag trends. And exclusive contributions from guest editors. The type of customer for this type of product serves the ages from tens to adult age parties because of the brands and styles of shoes available majority women.
Athleta: women performance athlete wear.
This product line is for women only; it is designed for the female athlete.
Fiscal Year Financial Comparison for Gap, Inc 2009 (In Millions)

Total Revenue $14,197.00
Net Income $1,102.00
Total Assets $7,985.00
Gross Profit $5,724.00

2008 (In millions)

Total Revenue $14,526.00
Net Income $ 967.00
Total Assets $7,564.00
Gross Profit $ 5,447.00

“As of January 30, 2010, cash and cash equivalents and short-term investments were $2.6 billion, with no debt outstanding.” –taken from Gap, Inc Annual Report Manual
Pac Sun

Incorporated: California
Founded: August 1982
PacSun is a Southern California inspired clothing, footwear, and accessories store targeting surfers, skate boards and teenagers interested in these styles.

Pacific Sun is shrinking. Over the last three years from February 3, 2007 to January 31, 2009 there has been an overall decrease in net income in three major categories. These categories are cash flows from operating activities, investing activities, and financing activities.
Pac Sun Sells has its own brand label of PacSun, but sells name brand merchandise from some of the top labels in surfing wear.
Fiscal Year Financial Comparison for Pac Sun 2009 (In millions)
Total Revenue $1,027.10
Net Income $ (70.30)
Total Assets $477.00
Gross Profit $258.60

2008 (In millions)
Total Revenue $1,254.89
Net Income $ (63.82)
Total Assets $569.51
Gross Profit $320.11

Gap, Inc and Pac Sun Comparison Gap (In Millions)
Net income for fiscal year of 2009- $1,102.00
Total assets-$7,985.00
Total Equity- $4,981.00
Total liabilities- $3,094.00

Pac Sun (In Millions)
Net income for fiscal year of 2009- $ (70.30)
Total assets-$477.00
Total Equity-$306.68
Total liabilities- $170.54
Comparison between Gap, Inc and Industry The Gap, Inc. price 25.00
Comparable Companies
The Wet Seal, Inc, price 5.15
American Eagle Outfitters, price 17.83
Limited Brands, Inc, price 27.07
The Buckle, Inc, price 38.32
Urban Outfitters, Inc, price 38.41
J. Crew Group, Inc, price 46.71
Anercrombie & Fitch Co, price 48.67
Comparison between Pac Sun and Industry Pac Sun price 5.95
Comparitive Companies
Aeropostale, price 30.59
Urban Outfitters, Inc. 38.41
The Men’s Wearhouse, Inc price 25.76
The Wet Seal, Inc price 5.15
Recomendation The financial health of both companies is not at its best. Pacific Sunwear had its worst year in the company's history in 2007. While, The Gap, Inc is still building and opening stores, it is not in a very good financial state. This could be do to the negative slope of our country’s economic status.
We would…..
Hold Pac Sun stock and Buy stock in The Gap, Inc
Questions? Comparison of Ratios
2009 2008

Current Ratio- 2.42 2.06
Asset Turnover- 1.96 2.0
Inventory Turnover- 7.81 6.1 Pac Sun
2009 2008

Current Ratio- 2.16 1.88
Asset Turnover- 1.78 1.92
Inventory Turnover- 9.61 9.65
Full transcript