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Piper Jaffray Raises Price Target on Carter's (CRI) Following an in Depth Analysis

July 2, 2015 6:46 AM EDT
Get Alerts CRI Hot Sheet
Price: $84.31 --0%

Rating Summary:
    7 Buy, 11 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 9 | Down: 10 | New: 42
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Piper Jaffray maintains an Overweight rating on Carter's (NYSE: CRI), and raised the price target to $116.00 (from $110.00), following an in depth analysis. Analyst Stephanie Wissink says that a rare general market multiple expansion, and consistency in the model, warrants a premium among retail and apparel companies.

Wissink commented, "We are maintaining our Overweight rating and view of CRI as a solid core holding. Following an in depth analysis of product, pricing, and social followership, in combination with an improving birth rate trend and a shift in the model from investment to monetization, we think upside exists. We are adjusting our estimates higher and adding a turn to our valuation multiple (to 21x), given general market multiple expansion and the consistency in the model, which in our view is increasingly rare and warrants a premium among retail and apparel companies. As earnings lift, we expect the multiple to hold in the low-20s, justifying price appreciation in tandem with EPS growth in the mid-/upper-teens. We also expect cash priorities around buybacks (another potential authorization), yield, and growth acquisitions. Our $116 PT (vs. $110 prior) is based on 21x FY16E EPS."

For an analyst ratings summary and ratings history on Carter's click here. For more ratings news on Carter's click here.

Shares of Carter's closed at $108.04 yesterday.



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