Gap Inc. (NYSE:GAP) saw its share price increase by 12.94 percent on Friday to close at $23.48 apiece after naming a new chief executive officer to help revive its now-struggling highest revenue-generating brand.
In a statement, the company named Michael Francis as new president and chief executive officer for Old Navy effective November 2, 2026. He will succeed Haio Barbeito, who will transition into an advisory role.
Investors took the announcement positively, given Old Navy is Gap Inc.’s (NYSE:GAP) largest revenue-generating brand.
Photo by Mizuno K on Pexels
Who is Francis?
Francis joined Gap Inc. (NYSE:GAP) as chief customer officer and head of marketing shared services for Old Navy in March 2026.
Prior to GAP, he served as strategic advisor to Walmart’s C-suite and board for a decade, and supported the world’s largest retailer in becoming a nearly $200 billion-revenue company.
He also supported the launch of dozens of brands for global companies, designers, and cultural icons with his four decades of leadership experience in commercial, marketing, and business transformation.
“Old Navy is poised for its next chapter of growth, and Michael is uniquely equipped to step into this operating role,” Gap Inc. (NYSE:GAP) President and CEO Richard Dickson said.
“His experience building iconic brands, cultivating customer connections, and driving transformation at scale will help Old Navy strengthen its relevance, accelerate growth, and deliver even greater value for customers,” he added.
Francis is expected to resume the company’s transformation already underway, with a focus on strengthening the brand’s commercial and marketing channels, enhancing the omni-channel customer experience, and elevating in-store experiences, among others.
Q2 Profits Up
Friday’s rally can also be attributed to the listed firm’s strong earnings performance in the second quarter of the year.
During the period, net income more than doubled to $501 million from $216 million in the same period last year.
Net sales, however, dipped by 2 percent to $3.65 billion from $3.7 billion, as comparable sales dipped 1 percent.
Store sales decreased 3 percent, while online sales—which accounted for 35 percent of the total sales—tumbled by 1 percent.
Q3 Dividends
In line with the results, Gap Inc. (NYSE:GAP) announced the distribution of $0.175 in dividends per share held by all shareholders on record as of October 7, 2026. Payments will be made on October 28.
Analyst Ratings
Four investment companies raised their price targets for the stock following the results.
UBS upgraded the stock to $42 from $40, while maintaining a buy recommendation, while TD Cowen issued a $27 price target, an increase from $23 prior, alongside a buy recommendation.
Wells Fargo raised its price assessment to $23 from $21, alongside an equal weight rating, while Morgan Stanley issued a $23 price target, higher than $21 previously, alongside an equal weight rating.
Hedge Funds Buy In
Apart from analysts, more hedge funds appeared to have established positions in Gap Inc. (NYSE:GAP), albeit conviction remained limited.
Data from Insider Monkey showed that 36 hedge funds held positions in the stock in the second quarter of the year, up from 31 in the first quarter.
However, committed capital declined by 16 percent to $647.7 million from $773 million quarter-on-quarter, signaling that while more institutional investors established exposure, they remained cautious about the company’s long-term growth story.
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