Carter's Finally Is Deserving Of An Upgrade As Revenue Grows And A Tariff Check Is On Its Way

Carter's is upgraded to a soft 'buy' as revenue growth and strong Q1 results offset ongoing profitability pressures. Q1 2026 revenue rose 8.1% to $681.1M, with the US Retail segment driving double-digit volume and higher pricing. Management guides for low-to-mid single-digit revenue growth in FY26 but expects operating cash flow and EBITDA to decline.