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Shares of retailer and designer Michael Kors Holdings Ltd. (KORS) gained over 2% in early trading Wednesday, Sept. 27, after Canaccord Genuity analyst Camilo Lyon upgraded the stock to "buy" from "hold."

Kors's turnaround is starting to happen, Lyon said. Kors' management-orchestrated reversal could result in a "multi-step [profit and loss] march upward that will manifest through both comps and gross margins over the next few years," Lyon wrote.

Margins on core earnings before interest and taxes excluding Kors' recent Jimmy Choo acquisition could reach 19%, up from 16% this year, Lyon added.

Lyon placed a $58 price target on Kors, up from $43. The new target implies a 17% upside for the shares from their premarket trading level.

Kors stock is up 11% so far this year, roughly in line with the broader S&P 500's 12% gains during the same period.

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