On Feb. 27, 2004, Standard & Poor's Rating Services revised its outlook on specialty apparel store operator The Gap Inc. to stable from negative. The outlook change reflects the substantial improvement in operating performance that the company has made over the past two years and its cash-rich balance sheet. Ratings on the company, including the 'BB+' corporate credit rating, were affirmed. The ratings on San Francisco, Calif.-based The Gap reflect management's challenge to improve the business fundamentals of its three brands in an industry that will continue to experience intense competition. These factors are offset, in part, by the company's strong business position in casual apparel, geographic diversity, and strong cash flow. Management's initiatives to improve product quality and assortment,
