UPDATE: Canaccord Genuity Raises PT on Conns on Top-Line Growth and Expanding Retail Gross Margins
In a report published on Tueday, Canaccord Genuity analyst Laura Champine raised the price target on CONN's (NASDAQ: CONN) from $53.00 to $63.00, and maintained a rating of Buy.
In the report, Canaccord Genuity noted, "We expect Conn's to generate average annual revenue growth of 21% over the next five years supported by the company's proprietary in-house financing program. We believe Conn's square footage growth potential is the highest in the retail group, and increasing penetration of the higher-margin furniture and mattress business should continue to expand retail gross margin. We are raising our FY14 retail gross margin forecast of by 120bps to 37.7% driven by our expectation for a faster mix shift to the furniture assortment. As a result, our FY14 EPS estimate moves $0.13 higher to $2.63, $0.14 above consensus and the highest estimate among sell side analysts. We are raising our FY15 projection by $0.18 to $3.61, which is $0.43 ahead of consensus and the high estimate."
Conns closed at $47.37 on Monday.
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