UPDATE: Canaccord Genuity Initiates Francesca's Holdings at Buy on Growth Prospects
Canaccord Genuity initiated coverage on Francesca's Holdings (NASDAQ: FRAN) with a Buy rating and a $30 target.
Canaccord Genuity noted, "We believe FRAN's unique business model positions the company to profitably expand its store base. A low-cost, small-footprint store model has translated to EBIT margins in the mid-20% range and one of the specialty retail group's highest ROIC at around 30%. We expect FRAN's boutique feel, driven by a broad and trend-right product assortment, should continue to resonate with customers as the company expands square footage at the highest annual rate among all of the companies in our coverage universe. We estimate double-digit SSS growth will persist in FY13, and we are modeling for EPS of $1.29, which is the highest forecast among sell-side analysts."
Francesca's Holdings closed at $23.95 on Thursday.
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