UPDATE: Brean Capital Initiates Coverage on New York & Company, Inc. with Buy Rating, $4 PT on Encouraging Long-Term Outlook

In a report published Tuesday, Brean Capital analyst Liz Pierce initiated coverage on

with a Buy rating and $4.00 price target. In the report, Brean Capital noted, "For years the merchandise focus at New York & Company (NYCO) was on fashion right offerings centered on basics and pants, especially in the wear-to-work category. While this strategy was effective at capturing the needs of working women, the assortment lacked relevance in other categories, inhibiting the company's ability to get more of her apparel discretionary spend. However the new NYCO is a modern, collection driven, on-trend lifestyle brand that speaks to the energy and excitement of New York City's fashion heritage that we expect will drive both revenue and profitability higher. Although recent results were hurt by the West Coast port disruptions, weakness in seasonal items and challenging traffic trends, we believe port and product issues have been addressed while we believe sub-brand, omni and outlet initiatives will be effective at combating volatile traffic trends. Accordingly, we are encouraged about NWY's long-term results and thus, we initiate coverage with a Buy rating and a $4 target price; our TP is based on a multiple of 18x our FY16 EPS of $0.22 and a PEG ratio of 0.4x." New York & Company, Inc. closed on Monday at $2.45.