On the corporate data, Abercrombie & Fitch (ANF) is a solid company. My fundamental scores read Growth 99, Profitability 81, Financial Health 73, and an aggregate score of 100.
A solid company. But a bad stock when I bought it at $125.87 at the beginning of the year, only to sell a month later at $105.56.
Yesterday ANF closed at $74.78. A week ago it traded a tad below $70. I missed the crash. And I missed today’s bounce.
Today Abercrombie & Fitch bounced +8.88% to $81.42, up roughly 11% to 13% in morning trade on excellent earnings news. Q1 2026 adjusted EPS came in at $1.47 against $1.28 expected. Record quarterly net sales of about $1.1 billion. Continued growth across the Americas and Asia-Pacific. Gross margins excellent. Value hunters grabbed that 7.2 P/E and ran with it. Traders shrugged off the softer near-term guidance and focused on the beat.
And yet I’m happy to be out.
Consumer sentiment is now the lowest in the 75 years it has been measured, going back to 1952. The outlook for the company is also not hot. Insiders have been dumping shares.
All in, ANF was probably my worst trade in years. The pain isn’t the loss — it’s that I ignored the obvious. Manufacturers of consumer goods have been fighting an ebb tide, really difficult economic conditions. The stock had also doubled in the previous month, so what was I expecting? ANF is a consumer company, not AI. And just before I entered the trade, the ANF chart suddenly turned ugly.
Did today’s pop in ANF shake my confidence? No. The P3 Durable Growth portfolio is up +6.08% in less than a month since I restarted it on April 30.
The lesson is the oldest one in this business: we all make investments we’d like to have back. The discipline isn’t avoiding the bad trade — it’s owning it, learning from it, and staying with the process.
Timing is everything. And nobody gets it right every time.
P.S. The new billcara.com website is shaping up nicely. I think you will like the look and feel. Alexei is doing a terrific job. Although we are still testing, Alexei likes the vibe, and he’s having fun putting the finishing touches to a product that both he and I will be very proud to say it’s ours — built 100% from the ground up. We are trying hard to meet the June 1 target launch date.