Susquehanna maintains “positive” rating on GYMB, raises target price
Susquehanna Financial maintained its “positive” rating on The Gymboree Corporation (NASDAQ: GYMB). The 12-month target price for GYMB has been raised to $58.
GYMB reported a 4% decline in comp for Q309, in-line with the latest guidance. In October, GYMB’s baby girl category was the strongest, followed by kid boy, baby boy, kid girl and accessories. Region-wise, GYMB’s performance was the strongest in the Midwest. While GYMB’s Janie and Jack divisions continued to remain weak in October due to economic slowdown, Crazy8 division showed strongest performance. Susquehanna Financial believes that the start of fall sale at Crazy8 is a positive event for GYMB.
Gymboree was able to realize profit growth, despite fall in comps, improving earnings outlook for the quarter. Susquehanna Financial raised its earnings estimates for GYMB on the basis of the company’s ability to consistently drive profitability.
