Retail Stock Ready to Soar After Fresh "Buy" Rating

Craig-Hallum is targeting 20-month highs for BKS

Managing Editor
Dec 17, 2018 at 9:30 AM
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The shares of Barnes & Noble, Inc. (NYSE:BKS) are up 4.9% in electronic trading, after Craig-Hallum upgrade the book retailer to "buy" from "hold," while boosting its price target to $10 from $7. The new price target represents territory BKS hasn't traded near since March 2017, and is a 54% premium from Friday's closing perch of $6.49. 

Today's rally takes Barnes & Noble stock back above its year-to-date breakeven point. In November, BKS climbed to an annual high of $7.71 amid buyout buzz. The shares pulled back from there to start off December, but quickly found support neartheir 80-day moving average. 

That annual high could be revisited as the remaining shorts are squeezed out. Short interest fell by 2.8% in the most recent reporting period to 11.13 million shares, the lowest since mid September. Still, this represents a hefty 19% of BKS' total available float, and nearly nine days of pent-up buying power, at the average pace of trading.

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