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Dillard's shares up again Friday

Dillard's shares rose another $1.03 to $58.86 on the New York Stock Exchange Friday, a day after the company released holiday-quarter profits that easily beat Wall Street estimates.

Credit Suisse has a new $59 price target on the shares.

Updated: 4:32 p.m.:

Here’s what CS analyst Michael Exstein said Thursday in an updated research note:

“Throughout the 4Q11 reporting season, we have seen retailers that are heavily exposed to the (fashion/accessories/beauty) categories deliver impressive results, and DDS is no exception...Retailers with access to the FAB categories have consistently outperformed their peers that don’t, and we see no signs that this trend is changing. Shoes and accessories alone make up 30 percent of DDS business, and we have no doubt that this helped to drive the company’s 3 percent increase in same store sales and further expansion of its operating margin...Now that the retail gross margin appears to have stabilized..., further expansion of the operating margin will likely need to result from continued top line improvement.”

On sales, CS noted, “same store sales increased 3 percent, representing the sixth straight quarter of positive comps. A six-quarter winning streak is something the company hasn’t accomplished since the 1990s, and further cements the company’s turnaround.”

CS increased its fiscal 2012 earnings-per-share estimate to $5.50 from $4.88, to include an extra week, lower rental costs, and lower average share count. In 2012, CS said it expects 1.6 percent same-store sales growth. CS raised its share price target from $50.

- Scott Nishimura


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