Wells Fargo Upgrades Carter’s to Equal Weight, Raises Target to $42
WFC•Wells Fargo raised its rating on Carter’s to Equal Weight from Underweight and lifted its price target to $42 from $30, citing improved execution under new leadership and stronger direct-to-consumer momentum. The firm boosted fiscal 2026 EPS to $3.30 (from $3.00) and fiscal 2027 forecast to $3.80 (from $3.50).
1. Rating and Price Target Increase
Wells Fargo upgraded Carter’s rating to Equal Weight from Underweight and increased its price target to $42 from $30, marking a 40% uplift in valuation expectations based on projected fiscal 2027 earnings.
2. Drivers of Improved Outlook
Analysts highlighted stronger execution under the refreshed management team and accelerating direct-to-consumer operations as key factors, while anticipating potential upside from recently lowered apparel tariff rates.
3. EPS Forecast Revisions
The firm raised its fiscal 2026 EPS estimate to $3.30 from $3.00 and boosted fiscal 2027 to $3.80 from $3.50, both above market consensus of $3.22 and $3.61, suggesting more robust profitability ahead.
