UPDATE: JP Morgan Upgrades Saks to Overweight on Top-Line and Margin Drivers

JP Morgan raises its rating on Saks SAKS from Neutral to Overweight and increases its price target from $11 to $12. JP Morgan comments, "Five key points: (1) Omni-channel opportunity substantial (1H13 pilot; 2H13 launch) w/ meaningful online expansion (fashion opportunity w/ little risk), (2) Store renovations (shoe floor a 50-100bps lift in Fall '12) and assortment edits (private label/exclusive to 20% from 12% today) top-line accretive, (3) 8% EBIT “moderate-term” target intact with GPM & SG&A drivers (JPM at 7.1% by '15), (4) tourism a worst case neutral (China/Brazil strength potentially offset by Europe), and (5) balance sheet an increasing point of strength ($189M cash; $200M annual FCF through 2015; 23.4% debt/cap). We are establishing a December 2013 price target of $12." SKS closed at $10.38 on Thursday.