Ask Matt: Can The Gap get out of the hole?

Q: Can The Gap get out of the hole?

A: Any child of the 1980s can probably remember back-to-school shopping at The Gap (GPS). The retailer just can’t seen to regain its glory days with shoppers.

Shares of The Gap weakened again Tuesday, falling 6% to roughly $24 a share. Investors are frustrated by the lack of traction at the company’s seemingly perpetual turnaround. Late Monday the retailer reported sales at stores open at least a year fell 4% in July. Shares have lost roughly a third of their value over the past year. The company can’t seem to find any growth. The Gap’s revenue over the past 12 months has fallen 4.5%, and that’s coming off a 3.9% revenue drop in the fiscal quarter ended in January 2016. Revenue growth has declined in each of the past three fiscal years. Analysts aren’t all that optimistic things will get better anytime soon. The Gap’s revenue in the current fiscal year ending next January is expected to drop 3% to $15.3 billion, says S&P Global Market Intelligence. During that same period, adjusted profit per share is forecasted to decline by nearly 20%. With a lack of growth, investors don’t see a compelling reason to own The Gap, even thought it’s only trading for 12 times trailing earnings. Analysts rate it “hold.”

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.