UPDATE: Wunderlich Initiates Coverage On Perry Ellis International, Inc.

Analysts at Wunderlich Securities initiated coverage on Perry Ellis International, Inc. PERY with a Buy rating and $25 price target Friday.

Eric Beder stated,”management has refocused the company on higher margin core operations, materially cut expenses, and positioned the business to drive top and bottom line upside.”

Key points to consider for the upgrade include:

• Perry Ellis is a major supplier to many “big box” retailers
• The company significantly improved its business model; Perry Ellis cut expenses, reduced impact of tertiary brands, cut lower margin products, and upgraded the company’s retail operations.
• Perry Ellis is creating a licensing “powerhouse.” Analysts stated, ”we believe that the company's licensing operations are worth over 50% of the company's enterprise value.”

Shares of Perry Ellis closed Thursday at $20.34