Shares of J.C. Penney ( JCP) reached fresh highs Thursday after JPMorgan upgraded the department store operator to overweight from neutral.

Analyst Charles Grom also tacked a $104 price target on the stock and raised his fourth-quarter earnings estimate to $1.96 a share. He put the stock on JPMorgan's focus list.

The report said that Penney's January comps are on plan and poised to move higher due to colder temperatures.

Grom also said that after a meeting with a Penney executive, "We have a greater respect/understanding for Penney's cycle time reduction efforts."

The report also lists positive catalysts for 2007, including a potential brand development deal with Ralph Lauren ( RL) and a new marketing campaign.

Shares recently were up $3.18, or 4%, to $82.79. Earlier in the session, the stock hit a 52-week high of $83.08, surpassing the previous high of $82.49 set in November. The shares traded at a 52-week low of $54.18 last February.

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