UPDATE: Oppenheimer Upgrades Ann to Outperform, Names $38 PT on Company Evolution

In a report published Thursday, Oppenheimer analyst Anna Andreeva upgraded the rating on

from Perform to Outperform, and named a $38.00 price target. In the report, Oppenheimer noted, “We are upgrading ANN to Outperform (from Perform) with a $38 price target. Historically, ANN trades at a discount to our specialty retail group (~3 point delta on EV/EBITDA basis and 2 points on next 12 months' P/E) given the inherent fashion volatility of the model. However, with a big focus on omni-channel, changes in the organizational structure, and faster lead times/new systems, we believe the company is evolving into a more stable retailer that can grow operating margins from 7.4% toward the goal of 10%–12% ($3.00 per share in earnings power).” Ann closed on Wednesday at $32.01.