Will This Upgrade Help Carter's Inc (CRI) Today?

NEW YORK (TheStreet) -- Carter's Inc (CRI) has been upgraded to "overweight" from "neutral" with a $92 price target, Piper Jaffray said Wednesday. The firm said Carter's can deliver solid execution in the presence of a favorable secular backdrop. 

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Separately, TheStreet Ratings team rates CARTER'S INC as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate CARTER'S INC (CRI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, notable return on equity, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Compared to its closing price of one year ago, CRI's share price has jumped by 33.07%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CRI should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 14.1%. Since the same quarter one year prior, revenues rose by 11.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, CARTER'S INC's return on equity exceeds that of both the industry average and the S&P 500.
  • CARTER'S INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CARTER'S INC increased its bottom line by earning $2.77 versus $2.69 in the prior year. This year, the market expects an improvement in earnings ($3.85 versus $2.77).
  • 45.99% is the gross profit margin for CARTER'S INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.48% trails the industry average.
  • You can view the full analysis from the report here: CRI Ratings Report
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