UPDATE: Stifel Nicolaus Upgrades L Brands (LB) to Buy
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Rating Summary:
17 Buy, 21 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 13 | New: 17
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Stifel Nicolaus upgraded L Brands (NYSE: LB) from Hold to Buy with a price target of $68.00.
Analyst Richard E. Jaffe said, "Near-term, we believe earnings will be held back by two factors: 1) It will take time for the company to offset the loss in sales from the recently exited apparel and makeup businesses ($0.10-0.12 per share negative impact TY) and 2) The company is investing in future growth (VS real estate and store payroll)."
"However, we believe fundamentally, the business is solid and momentum is strong. With the lack of distraction from apparel, we believe management will be able to better focus on the company’s core offerings driving sales and margin. Additionally, without the fashion risk associated with apparel, L Brands should garner a higher multiple. Given our more favorable outlook, we are upgrading LB to Buy from Hold. Our target price is $68 as we believe over the next twelve months the stock will trade up to 19x our 2015 EPS of $3.60 as visibility regarding the impact of the aforementioned changes becomes more evident. A 19x multiple is at a slight premium to the out year multiple high, which we view as appropriate given our improved outlook for the company," he added.
For an analyst ratings summary and ratings history on L Brands click here. For more ratings news on L Brands click here.
Shares of L Brands closed at $56.69 yesterday.
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