Is Abercrombie & Fitch Co. overvalued or undervalued?

As of 30 June 2025, Abercrombie & Fitch Co. has moved from a fair to attractive valuation grade. The company appears to be undervalued, supported by a P/E ratio of 14, a PEG ratio of 0.53, and an impressive ROE of 46.19%. In comparison, Gap, Inc. has a P/E of 10.22, while Urban Outfitters, Inc. shows a P/E of 13.77, highlighting Abercrombie's relative strength in the market.
Despite recent stock performance showing a significant decline with a year-to-date return of -39.85% compared to the S&P 500's 12.22%, Abercrombie's long-term returns are noteworthy, with a 3-year return of 480.81% versus the S&P 500's 70.41%. This suggests that while the stock may be facing short-term challenges, its long-term potential remains strong.