NEW YORK (TheStreet) -- Shares of Chico's FAS (CHS) are gaining 0.53% to $17.03 in Tuesday's early market trading after analysts at Mizuho upgraded the company to "buy" from "neutral" and raised its price target to $20 from $18.
Analysts expect the company to post strong first quarter results, along with an improvement in momentum in May and benefits from earlier announced cost reduction initiatives.
"With reduced receipts and over $93mm of opex cuts over 3 years along with store fleet rationalization and capital allocation programs, we believe this is an inflection point in CHS' fundamentals and see an 18% upside (to the stock) from current levels," they said.
Despite the slow start to the quarter to the quarter due to adverse weather conditions, analysts maintain their positive outlook and added that they believe the positive comp guidance issued by the company for the first quarter is achievable.
Chico's is a retail women's clothing chain based in Florida.
TheStreet Ratings team rates CHICOS FAS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHICOS FAS INC (CHS) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income."