Dillard's (DDS) Upgraded to Buy: Here's Why

Core Viewpoint - Dillard's (DDS) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook driven by an upward trend in earnings estimates, which significantly influences stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates, which are closely correlated with near-term stock price movements, particularly due to institutional investors' reliance on these estimates for valuation [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations for stocks, prompting institutional investors to buy or sell, thus affecting stock prices [4]. Dillard's Earnings Outlook - For the fiscal year ending January 2026, Dillard's is expected to earn $31.01 per share, which remains unchanged from the previous year, but the Zacks Consensus Estimate has increased by 3.9% over the past three months, reflecting analysts' growing optimism [8][10]. Zacks Rank System - The Zacks Rank system classifies stocks based on earnings estimate revisions, with only the top 20% of stocks receiving a "Strong Buy" or "Buy" rating, indicating superior earnings estimate revision features [9][10]. - Dillard's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].