ANALYSTS, INVESTORS LIKE SOUND OF SOLID SALES AT GUITAR CENTER.

Byline: Deborah Adamson Daily News Staff Writer

Shares of Guitar Center Inc. surged 12 percent Wednesday, bolstered by analyst recommendations.

Analysts upgraded the stock to a ``strong buy'' at George K. Baum & Co. in Minneapolis and to a ``buy'' at William Blair & Co. in Chicago. An additional eight analysts maintained their buy recommendations as well.

Shares of the music products retailer closed at $22.25, up $2.375. Trading volume was heavy at 991,000 shares, six times its six-month daily average. The stock had been taking a pounding in recent weeks, plunging from a six-month high of $32.75 on July 15 to a low of $19.875 on Aug. 11, or roughly 39 percent.

Guitar Center took a hammering as part of a sell-off that affected retailers, Nasdaq stocks and those with higher price-to-earnings ratios, analysts said. But the company's fundamentals remain attractive.

``We view it as a buying opportunity,'' said Dean Ramos, an analyst at George K. Baum. ``We still like their story a lot.''

The company's store locations and the depth and breadth of its products are strengths that have led to sales of $700 per square foot, compared with the industry average of $180 per square foot, said Alan Rifkin, an analyst at Piper Jaffray in Minneapolis who reiterated his ``strong buy'' recommendation.

The company's sales at stores open at least a year rose by 14 percent in the second quarter. These same-store sales accounted for 44 percent of total sales.

Same-store sales are considered a better gauge of store performance than total sales because they exclude revenues from newer stores, which tend to perform better and skew overall results.

Promotions and the roll-out of its Preferred Player credit card bolstered second-quarter performance, the company said in a filing with the Securities and Exchange Commission. However, the company said it doesn't expect same-store sales to continue at the same level.