A&F's plans to expand its brand outside the US will bring massive growth to the company and the stock. After the successful opening of its store in London, the company looks set to expand rapidly in the next 5 years as it looks to leverage upon its brand image and build up high margin international sales.

If A&F can leverage its popularity and sex appeal in its newest concept, Gilly Hicks could provide the catalyst for growth that A&F needs for the next ten years. Gilly Hicks can't help but make money selling high-margin underwear and body products.

As long as A&F brands are popular, teens (and adults) will be willing to pay premium prices for their clothes. A slow-but-sure increase in prices at the Hollister brand will likely increase profit (as it did years ago when A&F raised prices).

A&F's sex appeal is what is needed within the company, and the executives know that. People are looking for a fight with this company, but the stock should not be affected. They know who their market is (younger people) and they know what appeals to them. That is why they are perusing this marketing track, and it is a smart move. The only bad press, is no press.

A&F doesn't compete with the other stores in the mall. It offers more stylish and higher quality merchandise than its so-called "competitors." A&F is able to sustain a competitive advantage in the tough retail sector by creating the trends and setting the standards. Furthermore, A&F offers a quality and name brand that remain competitive with higher-end labels while pricing its merchandise more attractively.