Shares of Big Lots (BIG: sentiment, chart, options) are more than 3% higher after J.P. Morgan raised its rating on the stock from "neutral" to "overweight," with the broker citing the stock's reasonable valuation and a stabilization in same-store sales figures. Charles Grom stated that equity's price is down 16% since he initiated coverage in June 2007, despite the fact that BIG has exceed analysts' earnings expectations during each of the past 8 quarters.

Grom added that sales at BIG outlets open for at least 1 year appear to have stabilized, and the discount chain is now poised to benefit from a slowdown in the U.S. economy as shoppers seek out stores with more affordable prices. Additionally, the analyst upped his 2008 earnings outlook for BIG from $1.78 per share to $1.81 per share.

BIG shares have been on the upswing since late January, reclaiming the support of their 10-week moving average in the process (previously, this intermediate-term trendline highlighted the stock's decline since June 2007). Zacks reports that most brokerage firms are still skeptical of BIG the stock has earned 3 "strong buys," compared to 5 "holds."