Macquarie Adjusts Recommendations On Several Retail Stocks

On Thursday, Macquarie Research analyst Laurent Vasilescu adjusted the investment rating and price targets on multiple retail stocks:

Tiffany & Co. TIF upgraded to Outperform from Neutral; maintained $115 price target. Analysts believe the company will face tailwinds heading into the back half of 2014 leading to improved margins.

Lululemon Athletica inc. LULU downgraded to Underperform from Neutral; lowered price target to $34 from $40. Analysts believe the company needs to ramp up R&D expenses to compete with UA and Nike.

Francesca’s Holdings Corp FRAN downgraded to Underperform from Outperform; lowered price target to $11 from $16. Vasilescu feels the company needs to increase its advertising as it becomes a national brand.

Nordstrom, Inc. JWN downgraded to Neutral from Outperform; lowered price target to $70 from $77. Analysts feel there may be incremental costs associated with Trunk Club for FY15.

Urban Outfitters, Inc. URBN downgraded to Neutral from Outperform; lowered price target to $39 from $43. Analysts are concerned that the company’s plans to continue opening large concept stores may not complement the digital push.

Macy’s, Inc. M maintained Outperform rating; lowered price target to $63 from $66. Vasilescu writes “the company has done a great job investing in the ‘MOM’ (My Macy’s, Omnichannel and Magic Selling) strategy.”

Ralph Lauren Corp RL maintained Outperform rating and $180 price target. Analysts note SAP is in its peak investment year and we should begin to see payoffs in the back half of FY15 and beyond.

Ann Inc ANN maintained Outperform rating; lowered price target to $44 from $53. Vasilescu noted, “the company retains a solid, tenured management team which delivers consistent gross margin performance. We also see Golden Gate’s investment as a potential positive to unlock additional shareholder value.”

Fossil Group Inc (NASDAQ: FOSl) maintained Neutral rating and $110 price target. Analysts believe that the evolution of smart watches will be a significant positive for FOSL.

Michaels Companies Inc MIK maintained Neutral rating; raised price target to $18 from $17. Analysts favorably view the company’s multi-year strategy which includes improved store experiences, increased marketing and exclusive product selections as well as a cost savings initiative generated by employee suggestions.

Chicos FAS Inc. CHS maintained Neutral rating and $15 price target. Vasilescu stated, “We favorably view management’s plan outlined during the analyst day on September 7 to return to a 10% operating margin over the next few years.”