ANALYSTS have upgraded or maintained their buy recommendation on outdoor clothing and camping retailer Kathmandu, which defied the retail downturn with a profit upgrade following strong sales over Christmas and New Year.
Deutsche Bank upgraded its recommendation from "hold' to "buy" and increased its price target from
$NZ1.60 ($1.23) per share to $NZ2.65.
"Growth from Kathmandu's store rollout is likely to provide a buffer to any potential macroeconomic headwinds and rising cost pressures," it said.
"Kathmandu has a proven track record of opening stores and we are forecasting 15 new stores in each of 2011, 2012 and 2013. The risk here is cannibalisation, which reduced comparable store sales by 1.1 per cent in 2010," analyst Alexi Baker-McLennan said.
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