Wedbush Upgrades AnnTaylor Stores (ANN) to Outperform; Improving Loft Trends Could Lead to Above-Consensus F11 Earnings

Wedbush upgraded AnnTaylor Stores (NYSE: ANN) from Neutral to Outperform. PT increased from $27 to $38.

Wedbush analyst says, "We continue to witness strong conversion trends driven by strength at ATS and improved product blend at Loft. With both concepts delivering solid sales supported by management’s strategic pricing and sourcing initiatives following a multiyear restructuring program, we expect significant upside to consensus earnings assumptions and view the shares as compelling at current levels."

"Following BTE Q1 checks, we are raising our Q1 EPS estimate to $0.49 from
$0.48 prior given BTE comp trends (particularly at the Loft division). Our new
estimate assumes a total comp increase of +7.3% from +6.3% prior, which reflects +9% at ATS and +6% at Loft...We are raising our F11 and F12 EPS estimates to $1.88 from $1.80 and $2.28 from $2.18, respectively, on stronger sales trends, solid gross margins and improving SG&A."

For more ratings news on AnnTaylor Stores click here and for the rating history of AnnTaylor Stores click here.

Shares of AnnTaylor Stores closed at $31.52 yesterday.

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