Brean Capital Raises Price Target on Express (EXPR) Following Solid 4Q

Brean Capital reiterated a Buy rating on Express Inc. (NYSE: EXPR), and raised the price target to $27.00 (from $25.00), following the company's 4Q earnings report. Adjusted EPS was $0.67, exceeding Street estimate's of $0.65 as well as the high end of the company’s recently raised guidance of $0.63 to $0.65, with the beat being primarily driven by solid expense control.

Analyst Liz Pierce commented, "In our view, the most significant takeaway from Q4 and anticipated FY16 results is the validation of the changes that have been made to the way the company does business. More importantly, we believe those changes, which include better product and a better customer experience, have just begun to impact the bottom line and when combined with the system initiatives coming online this year, we believe there is still significant margin upside. We further believe EXPR still has significant organic growth potential in the areas of online, outlet and international. Finally, with the stock trading at 11.5x and 9.8x our FY16 and FY17 EPS estimates of $1.71 and $2.00, which is a discount to our estimated 3-year CAGR of 16% as well as to the peer group multiples of 16.7x and 15.2x respectively, we believe the valuation is compelling. Accordingly, we reiterate our Buy rating and raise our TP to $27 from $25, which is based on a multiple of 16x our FY16 EPS of $1.71 and PEG ratio of 1x."

For an analyst ratings summary and ratings history on Express Inc. click here. For more ratings news on Express Inc. click here.

Shares of Express Inc. closed at $19.66 yesterday.

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