Ethan Allen (NYSE: ETH) reported earnings of $.34 last night, beating estimates by 13%. Revenue grew 10%, the highest rate since 2011, and earnings exploded 88%. The stock, as of this moment, is up 10%.

This confirms our thesis that the market is undervaluing the fundamental changes at this old-line furniture retailer. 

While part of the upside was linked to faster delivery of already booked orders, CEO Farooq Kathwari said in a statement that new products are being well received by consumers, and that he is bullish about three new lines of furniture being launched this summer. 

Ethan Allen could leap another 30% to our $43 target even after its jump this morning. We’ll be keeping our eyes open for upward revisions to estimates which would allow us to increase our target on this well-run retailer.

But for now, Ethan Allen is a Buy with a Target Price of $43.