J.Jill's Ability For Ongoing Topline Gains & Increased Profitability Impresses This Analyst

  • Telsey Advisory Group analyst Dana Telsey reiterated a Moderate Risk rating on the shares of J.Jill Inc JILL and raised the price target from $24 to $28.
  • JILL maintained strong operating momentum through the third quarter, with gross margin expansion and cost control driving year-over-year earnings growth despite a challenging macro environment.
  • The analyst added that the company’s inventory appears relatively clean heading into the holiday.
  • Following the third quarter beat, the fourth quarter outlook was also in line with the analyst’s expectations, prudently leaving room in the gross margin outlook for a competitive pricing environment.
  • The company sees its Welcome Everybody inclusive sizing initiative (launched enterprise-wide on August 4) as modernizing the brand and expanding the value proposition to improve relevance to its core consumer while attracting the next cohort of customers. 
  • With a better balance between the core offering and newness, J.Jill is telling a clearer story, in the analyst’s view, allowing the customer to better connect with the assortment over a longer selling period.
  • The merchandising work has left JILL well-positioned to capture shifting demand as customers return to pre-pandemic attire, and its professional customer base is less exposed to macro headwinds.
  • With an attractive customer base, strong omni-channel offering, and assortment enhancements, the analyst sees the ability for ongoing topline gains and increased profitability. 
  • Price Action: JILL shares are trading higher by 8.59% at $25.72 on the last check Wednesday.
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