Mizuho Securities Raises Price Target on Chicos FAS (CHS) to $15 Following 2Q
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Mizuho Securities reiterated a Buy rating on Chico's, Inc. (NYSE: CHS), and raised the price target to $15.00 (from $13.00), following the company's 2Q earnings report. CHS reported OpEPS of $0.25 came in ahead of the Street’s $0.23 estimate. Mizuho increased 3Q EPS estimates to $0.13 from $0.10 and projects total comps of (1.1)% and flattish EBIT margin of 4.5%.
Analyst Betty Chen commented, "We are raising our estimates and PT to $15 (from $13) as we believe CHS is in the early stages of a multi-year turnaround with stabilizing comps and progress toward improving margins. Although the retail environment may remain challenging, a leaner operating structure from recent cost reductions (total ~$90-110mm) and conservative inventory planning should support margins as the team continues to make headway in improving the overall assortment and finding new avenues for sales growth. We believe additional color on strategic initiatives during the Analyst day on 9/28 may provide another catalyst."
Shares of Chico's, Inc. closed at $11.30 yesterday.
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