UPDATE: Piper Jaffray Raises PT on Select Comfort Heading Into Holiday Weekend
In a report published Tuesday, Piper Jaffray analyst Peter J. Keith reiterated an Overweight rating on Select Comfort Corp. (NASDAQ: SCSS), and raised the price target from $28.00 to $31.00.
In the report, Piper Jaffray noted, “We remain buyers of SCSS into the 4th of July holiday weekend and are raising our PT to $31 (from $28). July 4th promotions appear largely similar on a y/y basis but SCSS has been closing out both the m7 and i10 products the last few weeks which should modestly help units and ASPs for both Q2 and Q3. Also, we note the cadence of promotions for Q2 was fairly comparable y/y which suggests SCSS did not have to become more promotional at quarter end to drive sales. Separately based on our analysis of comp unit and ASP trends, we believe there is an opportunity for SCSS to comp positively for Q2 (vs. our estimate of -3%). Our new PT is based on 18x FY14E EPS of $1.72 and we have raised our multiple to 18x from 17x to account for improved sales and EPS growth expectations in 2014.”
Select Comfort Corp. closed on Monday at $25.87.
© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.