Wedbush Morgan Reiterates a 'Buy' on Jo-Ann Stores (JAS); Raises Price Ttarget & 2010 Estimates

May 28, 2009 2:15 PM EDT

Wedbush Morgan reiterates a 'Buy' on Jo-Ann Stores (NYSE: JAS), raises price target from $22 to $24.

Wedbush analyst says, "Positive secular tailwinds, including market share gains from competitors exiting the business as well as positive industry trends in the sewing business and home nesting, should help to offset the challenging macro. In addition, the company has executed solidly with regards to merchandising, inventories, and balance sheet. Going forward, positives include potential margin expansion, increased imports from Asia, merchandise cost deflation, reduced freight costs, reduced exposure to markdowns on fashion/seasonal goods, and benefits from new store systems."

"...Surprisingly, the company did not raise full-year guidance, which we now view as overly conservative. Full-year guidance includes comps down 2-4%, EPS of $0.70-$0.85 vs. $0.76, improvements in gross margin, and higher SG&A. Management said current trends remain positive but would like to get better visibility on 2H before changing its view. Raising our forecast of Q2 LPS to $0.45 (from $0.47 LPS) on comps of +1.1%. We are also raising our forecast for full-year EPS to $1.10 on comps of +1.1% (previously $0.90)."

To see more analyst ratings on JAS Click Here.

Jo-Ann Stores, Inc. (JoAnn Stores) is a specialty retailer of fabrics and crafts, serving customers in their pursuit of apparel and craft sewing, crafting, home decorating and other creative endeavors.

Related Categories

Analyst Comments

Stocks Mentioned

Related Entities

• Wedbush Morgan

Add Your Comment

Name

Subject

Body

Verification can't see the text?
click here to refresh the image.
what's this?