Pacific Sunwear Stock Up Nearly 21%

Shares of Pacific Sunwear of California Inc. jumped sharply Thursday after two brokerage firms raised their ratings on the Anaheim retailer of casual clothing.

The stock rose nearly 21%, or $3.81 a share, to $22.25 in Nasdaq trading.

Analyst Kimberly Greenberger said the shares could reach $28 over the next 12 months.

“Same-store sales have stabilized and the company’s d.e.m.o. division is doing well,” said Greenberger, an analyst at Credit Suisse First Boston Corp., which raised its rating from hold to buy.

Pacific Sunwear’s d.e.m.o. division, considered the company’s growth vehicle, sells apparel inspired by hip-hop and rap music. The unit had negative same-store sales this summer, but in November these sales in stores open at least a year leaped 20.9%. Although the concept is only 2 years old, 80 d.e.m.o. stores will be open by year’s end, including 40 new outlets this year.

Ferris Baker Watts raised its rating on Pacific Sunwear to buy from long-term accumulate and has a $30 price target, analyst Joseph Teklits wrote in a research note.

Earlier Thursday, Pacific Sunwear reported same-store sales for the four weeks ended Nov. 26 rose 5.1%, while total sales rose 32% to $44.9 million from $34 million a year earlier.

Casual apparel retailer Wet Seal Inc. in Foothill Ranch also logged strong sales gains for the four weeks. Same-store sales rose 16%, while net sales climbed 19.2% to $45.3 million from $38 million a year earlier. The stock dipped 25 cents to $23.69 a share on the Nasdaq market.