Analyst upgrades Movado shares to 'Buy'

NEW YORK (AP) — A Morgan Joseph analyst on Friday upgraded shares of Movado Group Inc. to "Buy" and said the watch retailer had returned to profitability ahead of schedule.

Analyst Jeffrey Blaeser said that Movado has cut nearly $50 million in annual costs and has now passed what was expected to be its most difficult period. Blaeser also set a $16 price target for the stock.

The shares rose 27 cents to $12.36 in morning trading.

Movado said Thursday that its second-quarter profit tumbled on lower sales but its adjusted earnings still beat analysts' expectations. Its adjusted quarterly profit was 6 cents per share, better than the loss of 21 cents per share that analysts surveyed by Thomson Reuters expected.

Blaeser added that lower retailer inventories could possibly spur growth in the second half of the year.

Movado, based in Paramus, N.J., also sells its namesake watches as well as Coach, Hugo Boss and other brand watches.