Analyst Lifts Price Target On Retailer Talbots

NEW YORK (AP) — Shares of Talbots Inc. rose on Wednesday as an analyst lifted her price target on the women's apparel retailer and said management is making progress in turning around operations.

The stock rose $1.55, or 16 percent, to $11.11 in afternoon trading.

Friedman, Billings, Ramsey analyst Adrienne Tennant raised her price target on the stock to $13 from $8, which means that shares have room to rise nearly 36 percent from Tuesday's closing price of $9.56.

Tennant, who met recently with management and Chief Executive Trudy Sullivan, said that new Chief Financial Officer Michael Scarpa is effectively managing costs. "Thus far, he has delivered on the financial goals given to the Street," Tennant wrote in a client note.

Tennant also said that CEO Sullivan has improved merchandise and done away with its J. Jill brand. Over the summer, Talbots said it completed the sale of J. Jill to an affiliate of a San Francisco-based private-equity firm to focus on rejuvenating its core business.

"While the consumer environment remains challenging, we continue to believe that the company is taking the right steps to improve the product and expect Talbots to continue in the right direction to re-ignite customer interest," Tennant wrote in a client note.

Last month, Talbots said it posted a fiscal second-quarter loss as shoppers cut back on spending. Amid faltering sales, Talbots has cut jobs and inventory levels in an effort to improve results.