Build-A-Bear initiated with a Buy at DA Davidson

DA Davidson analyst Michael Baker initiated coverage of Build-A-Bear with a Buy rating and $42 price target. The firm, which calls Build-A-Bear an “underappreciated small cap growth idea,” contends that the retailer has “built an iconic brand with transferable equity outside of their core product segment” while also having successfully grown their customer base across age group and diversified their store formats. Over a five-year outlook, the firm forecasts double-digit EPS compound annual growth rate and sees the shares trading at “a significant discount to growth peers.”