Gap Inc (GAP) is undervalued and Victoria's Secret & Co (VSXY) is overvalued.
Against our estimates of intrinsic value, GAP trades at the wider discount: a margin of safety of +49%, against -45% for VSXY.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 10.1% (average of 3 methods) values the shares at $41.67; the price of $21.46 is 49% below that value, and 72% of that value comes from beyond year five.
Leak Score 100/100 on 3 of 12 signals
Discounting its cash flows at 11.1% (average of 3 methods) values the shares at $57.96; the price of $83.82 is 45% above that value, and 69% of that value comes from beyond year five.
Leak Score 14/100 on 3 of 12 signals
| Metric | GAP | VSXY |
|---|---|---|
| Verdict | Undervalued | Overvalued |
| Price | $21.46 | $83.82 |
| Intrinsic value | $41.67 | $57.96 |
| Margin of safety | +49% | -45% |
| Leak Score | 100/100 (3/12) | 14/100 (3/12) |
| Market cap | $7.5B | $6.7B |
| Revenue growth, 5 years | 2.2% | 3.9% |
| Operating margin | 10.8% | 9.8% |
| Net margin | 8.1% | 5.5% |
| Return on equity | 33.8% | 45.2% |
| Debt to equity | 1.45 | 2.93 |
| P/E | 6.4x | 18.9x |
| Forward P/E | 8.1x | 14.9x |
| P/B | 1.9x | 6.8x |
| Dividend yield | 3.2% | — |