Luxury Retailers Get an Upgrade

NEW YORK (TheStreet) -- Luxury is leading retailers out of the recession, at least according to Goldman Sachs, which upgraded the stocks of several companies in the sector on Monday.

The brokerage firm raised its ratings on Nordstrom(JWN Quote), Coach(COH Quote), Saks(SKS Quote)and Tiffany(TIG Quote), while downgrading J.C. Penney(JCP Quote)and Dollar Tree(DLTR Quote).

"We take a more constructive view of high-end retailers and step aside from those in the path of Wal-Mart(WMT Quote)," Goldman wrote in a note.

Goldman raised its rating on Nordstrom to buy and its price target to $41 from $39. Last week the company reported a 17% jump in third-quarter profit and upped its full-year outlook.

Coach also received a buy rating and Goldman raised its price target to $42 from $37. Coach has been seeing a boost as it introduces lower-priced products to its stores. While third-quarter profit still slipped 3% to $140.8 million, or 44 cents a share, North American sales spiked 8%.

Meanwhile, J.C. Penney was lowered to sell by Goldman, and its price target was revised to $32 from $36. The department store reported a 78% plunge in its third-quarter profit on Friday, weighed down by expenses to fund its pension plan. It also announced a full-year outlook that could fall short of Wall Street's expectations.

-- Reported by Jeanine Poggi in New York

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