UPDATE: Bank of America Upgrades Kohl's on Operating Growth Potential, FCF Strength

In a report published Thursday, Bank of America analyst Lorraine Hutchinson upgraded the rating on

from Neutral to Buy, and raised the price target from $60.00 to $65.00. In the report, Bank of America noted, “We are upgrading Kohl's to Buy from Neutral as we think F2014 will be an inflection point where operating income growth turns positive, while robust shareholder returns continue. After two years of operating income declines, we think Kohl's is finally poised to reap the benefits of its sales growth initiatives now that inventory is back at manageable levels. Meanwhile, Kohl's FCF yield of 13% is the highest across our coverage universe. The stock is trading at a discount to peers on an EV/EBITDA basis (at 5.5x versus 6.0x); we are raising our price objective to $65, which reflects the peer average multiple.” Kohl's closed on Wednesday at $54.38.