Moving against the broader market trend, Falabella’s shares rallied strongly on Tuesday while much of the Santiago Stock Exchange traded cautiously ahead of an expected interest rate hike by the U.S. Federal Reserve.

The retailer’s stock rose 3.13%, leading gains within the IPSA Index, which declined 0.17% during the session.

As a result, Falabella’s shares closed at CLP 6,560 per share, their highest level in seven months. The stock last reached its all-time high in early February, when it traded at CLP 6,800 per share. This means the stock is now only 3.7% away from matching that record.

It is worth noting, however, that Falabella’s stock has become increasingly volatile following the end of the company’s controlling shareholder agreement, making it more exposed to broader market fluctuations.

Why Has Falabella’s Stock Become More Volatile Since the End of the Shareholders’ Agreement?

The recent appreciation in the company’s share price comes after several research departments raised their outlook on the stock following the release of second-quarter earnings.

According to Bloomberg data, the average target price for Falabella increased by 3.1% between August 13 and September 16, reaching CLP 7,050 per share. This implies a potential 12-month upside of 7.5% from current levels.

The latest institution to revise its outlook upward was Credicorp Capital Research. In its report, Investor Guide 2027, the firm upgraded Falabella’s recommendation from “Hold” to “Buy”, while raising its target price from CLP 6,000 to CLP 7,500 per share, implying an upside potential of approximately 14%.

As a result, Credicorp selected Falabella as one of its Chilean “Top Picks”, alongside LATAM Airlines and BCI.

“Falabella stands out as another preferred investment option, given the superior quality of its results, its strong execution track record, and a more balanced business mix compared to its competitors,” Credicorp stated in its report.

“We also believe its valuation remains attractive and undemanding, as the market has yet to fully reflect its higher structural profitability and the revaluation potential stemming from its banking and shopping mall businesses.”

The firm further noted:

“At this stage of the year, we expect 2026 results to remain broadly in line with those recorded in 2025, a year that marked a peak in performance.”

“Nevertheless, we believe performance should benefit from a more normalized contribution across the company’s different business units, making these figures a better indicator of Falabella’s long-term earnings-generation capacity.”

The renewed optimism from analysts, combined with the company’s strong operating results and improving investor sentiment, has helped push Falabella’s shares back toward record territory after a strong recovery over recent months.

Source: El Mercurio Inversiones.