Fitch Ratings cut its outlook on Gap after a tough year.

Analysts at Telsey Advisory Group met with senior management of Gap Inc. earlier this week in Boston, and the takeaways include an assessment that the company is well underway in repositioning itself.

The analysts noted that the retailer is “moving to modernize its business model and regain market share, particularly in North America” amid “a new environment of how consumers are choosing and purchasing goods.”

Telsey analysts met with chief executive officer Art Peck, senior vice president of corporate finance and investor relations Jack Calandra and senior manager of investor relations Tina Romani.

“Its heritage and iconic roots gives it the ability to continually reinvent itself, yet the processes in which it can regain momentum are now being rebuilt, from product development to supply chain to assortment architecture,” the analysts told investors. “Overall, the goal is to increase gross-margin dollars by improving fit and quality and the consistency of each, and operate the business with less units to drive a higher AUR [average unit retail], ultimately yielding more sustainable gains in comparable-store sales and margin dollars.”

By brand, Telsey analysts said Peck “reiterated his view that the Gap brand is best served through a collaborative design team working through clear brand filters rather than attempting to bring to market the vision of a single creative director.” The analysts said key to the brand’s success is “getting women’s bottoms right.”

“In addition, re-establishing authority in bottoms will help to drive the tops business,” the analysts said. “Like quality, Mr. Peck believes successful fit parameters are a known science at Gap that prior design teams moved away from with little success. Improving to a consistent and appropriate fit also minimizes markdowns as sell-through improves. The result equates to a return of the brand to its casual, optimistic, American identification.”

The retail analysts described this brand’s women’s offering as “more feminine and colorful, featuring some prints, with the right level of sophistication and the right aesthetic for the brand.”

With Banana Republic, the analysts described it as the laggard for the company, “having turned in double-digit comp declines in seven of the last eight months.”

“Management has commented that [Banana Republic] has been slower to adapt as there has been too much fashion in the assortment that did not incorporate the ultimate DNA of the brand of classic items with a contemporary update that become part of the customer’s foundational wardrobe that will last,” the analysts said. “The combination of too much fashion and cost being taken out of the product has led to weak results. Banana is now refocusing itself and righting the ship through a return to offering classic items in a contemporary way.”

For Old Navy, Telsey analysts said it is “still the engine and opportunity for growth” and that a “search continues for a new leader of Old Navy, which may soon come to fruition.”

Late last month, Fitch Ratings cut its outlook on the company to negative from stable after a challenging 2015. The ratings agency said the change was a reflection of the “continuation of weak operating trends across Gap’s brands.”

Fitch said that it expects the retailer’s earnings before interest, taxes, depreciation and amortization to slip to $2.1 billion this year from about $2.3 billion in 2015.

“Gap faces operating challenges both near-term and long-term,” Fitch said in its report, adding that the retailer is “struggling alongside other midtier apparel retailers, as the industry has seen sales bifurcated to higher-end aspirational brands and lower-end fast-fashion and off-price channels.”

Fitch said the macroenvironment challenges are “exacerbated by a lack of a strong product cycle and Gap Inc.’s inability to connect with customers with compelling, trend-right fashion — particularly at the Gap and Banana Republic brands.”