UPDATE: Piper Jaffray Upgrades Children's Place, Notes 'Compelling Pathway' Of Improvements

In a report published Thursday, Piper Jaffray analyst Stephanie Wissink upgraded

from Neutral to Overweight and raised the price target from $54.00 to $62.00. Wissink reviewed the key drivers of The Children's Place operating margin target. The analyst commented "We see an increasingly compelling pathway, which is less reliant on sales growth and more on self-managed improvements in operating structure and processes. Near-term, we are taking a slightly more conservative approach to estimates, reflecting ongoing traffic volatility through Q4-end and a more measured rebuild in sales through 2014." Piper Jaffray noted the company's expense saving initiatives and improved "business logic" through ERP implementation. The analyst reported that The Children's Place could drive earnings greater that $5.50 in the next three years. This is an 80% increase to Piper's Full Year 2014 EPS estimate of $3.20. The Children's Place management reiterated fourth quarter EPS guidance of $0.90-$0.98 mid-January. Piper Jaffray lowered their estimate from $0.92 to $0.90 based on a predicted 3% comp decline. The analyst noted that her thesis is "less sensitive to near-term fluctuations and see a low-$50s level as compelling." Shares of The Children's Place closed at $52.03 on Wednesday and have traded as high as $53.77, up 3.34%.