Abercrombie & Fitch Co. (ANF); The Fickle World of Fashion

However, the company does have two factors that could work in its favour. Firstly, the fashion world and retail customers in general have a short memory and a season of discounts on quality clothing will bring them back.

Secondly, no publicity is bad publicity.

Conclusion

Inventory levels have been a problem for Abercrombie in the past and the company could be faced with these problems again over the next few months, as consumers move away from the brand after this quarter’s negative PR.

Based on that speculation, I believe that for the time being, until the effect of this negative PR is known, investors should stay away from the company. If Abercrombie finished this quarter with high levels of inventory, significant discounting and falling profits could follow in Q3.

Fool contributor Rupert Hargreaves has no position in any stocks mentioned. The Motley Fool recommends Guess?. The Motley Fool owns shares of Guess?.

The article Abercrombie & Fitch; The Fickle World of Fashion originally appeared on Fool.com and is written by Rupert Hargreaves.

Rupert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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