UBS Evidence Lab inside: 2Q Preview: We See a Balanced Upside/Downside Skew

Research evidence excerpt

UBS Evidence Lab inside: 2Q Preview: We See a Balanced Upside/Downside Skew

Powered by Lab Global8 JulyResearch2026ab Evidence UBS YES

Carter's Inc Equities

AmericasUBS Evidence Lab inside: 2Q Preview: We See a

Balanced Upside/Downside Skew Retailers, Apparel

12-month rating Neutral *

12m price target US$41.00We don't expect Street EPS estimates or the stock's P/E to move much:

Our checks suggest CRI’s 2Q26 fundamentals were generally solid. We forecast an

essentially in-line quarter and no change to CRI's FY26 guidance. Thus we doubt CRI's Price (07 Jul 2026) US$39.82

2Q report causes Street estimates to move much. At the same time, we believe the RIC: CRI.N BBG: CRI US

market has a similar expectation. As a result, we don't see the earnings report catalyzing

the stock's P/E much in either direction. The options market is pricing in a +/- 9.8% jump Trading data and key metrics

over the event vs. 5.7% historical avg. move. We anticipate less vol than +/- 9.8%. 52-wk range US$44.37-23.65

Market cap. US$1.40b

We think sentiment leans very slightly positive: Shares o/s 35.2m (COM)

CRI's stock price is up 22% YTD vs. the S&P 500's ~flat move. Yet, UBS Quant Team's Free float 98%

data shows CRI's crowding score is only slightly above the Softlines average (Figure 5Last3monthsview:AsofJuly3rd,CRI'sCrowdingScoreis4.1slightlyabovethesoftlines3.3averageindicatingthestockisslightlylongcrowded.). Avg. daily volume ('000) 359

Plus, our conversations with investors suggest sentiment leans very slightly positive. We Avg. daily value (m) US$13.6

believe the "bars" for the event are a 2Q26 result in-line to slightly better than Common s/h equity (12/26E) US$1.02b

consensus, 3Q26 EPS guidance range of 70c to 80c, and no change to CRI's FY26 EPS P/BV (12/26E) 1.4x

guidance.