Piper Jaffray Boosts Estimates, PT on Build-A-Bear (BBW)

Piper Jaffray analyst Stephanie Wissink reiterated an Overweight rating and boosted her price target on Build-A-Bear Workshop (NYSE: BBW) to $23.00 (from $18.00), saying they see the next phase of the model recovery in 2015.

Wissink commented, "We are reiterating our Overweight rating and raising our estimates and PT following a deeper review of our model, evaluation of recovery strategies, and consideration for potential cost restructuring of the business. Checks suggest topline momentum has carried into the early weeks of the holiday season. Stronger, more direct marketing campaigns coupled with a larger selection of kid favored licensed brands puts BBW in a solid position for a greater percentage of holiday spend vs. prior years. The company will recognize a 53rd week in Q4, which we've now appropriately accounted for in our model. We also see signs that pricing and costing initiatives are sticking, lending to product margin expansion into 2015. And we look for a more formal cost rationalization plan to be unveiled in 2015. On balance, we see enough catalysts to drive additional value creation."

The firm raised FY14E EPS from US$0.62 to US$0.67 and FY15E EPS from US$0.72 to US$0.90.

For an analyst ratings summary and ratings history on Build-A-Bear Workshop click here. For more ratings news on Build-A-Bear Workshop click here.

Shares of Build-A-Bear Workshop closed at $18.80 yesterday.

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