Oppenheimer Upgrades Carter's To Outperform

• Analysts at Oppenheimer upgraded their rating on shares of Carter's, Inc. CRIfrom Perform to Outperform on Monday.
• The experts also boosted their price target on the stock from $90 to $108 to reflect strong prospects.
• Shares of Carter’s were trading up roughly 3 percent on the news on Monday afternoon.

Oppenheimer analysts upgraded shares of Carter’s from Perform to Outperform on Monday, while raising their price target to $108 from $90. According to a research note, the experts believe the company benefits from being a robust everyday brand that gains from increasing birth rates.

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A few issues should be taken into account when considering an investment in the company:

The report noted that the company has 14 percent market share in the kid’s space and an impressive 30 percent market share in the baby segment. U.S. birth rates are turning positive for the first time in 7 years. This provides a huge tailwind for the company.
“International tourism should be a drag” into the first half of 2016.
Estimates for 2017 need to be trimmed.
Promotional activity at Carter’s & OshKosh has improved considerably.
The next catalyst investors should keep an eye on is the fourth quarter earnings call – which will take place some time in February
Carter’s stock is “expensive and trades at a premium to the group but since the summer the multiple has contracted by about 3 points which we think makes it attractive,” the analysts concluded.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.