Morgan Keegan Reiterating Outperform On Fred's, Inc. (FRED)

Morgan Keegan is reiterating its Outperform rating and a $16 price target on shares of Fred's, Inc. FRED after it reported earnings. In a note to clients, Morgan Keegan writes, "We reiterate our Outperform rating and believe shares of FRED represent a favorable risk/reward scenario with our expectation for Core Five merchandise to drive improving comps and operating margins going forward. Shares trade at 5.5x our NTM EBITDA estimate (3-yr range: 4-11x)." Shares of FRED gained 17 cents yesterday to close at $13.06, a gain of 1.3%.