Piper Jaffray Raises PT on Select Comfort to $13 (SCSS)

Piper Jaffray is out with its report today on Select Comfort SCSS, raising its price target from $9 to $13. In a note to clients, Piper Jaffray writes, "Select Comfort reported its 8th consecutive quarter of earnings improvement. Sales totaled $149M (+9% Y/Y) for the December quarter and EPS of $0.13 beat the consensus of $0.10. For the year ending 2010, sales increased 11% and EPS grew 147% to $0.57. Gross margins improved 10bps during the quarter and 90bps for the full year. Consistent execution, improved strategy and improved category trends continue to lead to material earnings improvement. Cash flows during the full year were impressive at $71M and the company's cash balance improved to over $81M from $18M in the prior year period (and no debt). Based on continued execution, share gains and increased earnings expectations for 2011 we have increased our PT to $13 share - representing 25% upside potential from current levels. Reiterate Overweight rating - $13 PT based on ~15x CY12 EPS." Shares of SCSS are trading after hours at $11.65, up 11.06% from Wednesday's close.
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Posted In: Analyst ColorPrice TargetAnalyst RatingsConsumer DiscretionaryHomefurnishing RetailPiper JaffraySelect Comfort
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