STOCKHOLM, Sweden — After the shares slumped some 50 percent in the past three years, investor sentiment toward Hennes & Mauritz finally seems to have shifted.

With gains of 36 percent in the past three months, the stock has now erased the losses that made it the worst performer on the OMX Stockholm 30 Index in the first eight months of the year.

The gains have come on the back of better-than-expected sales data for the third quarter and fresh speculation that the Swedish retailer's biggest shareholder, chairman Stefan Persson, may seek to take the company private. The market also welcomed H&M's decision to close the struggling Cheap Monday brand, seeing it as a signal that the company won't shy away from tough decisions.

“H&M has gone from planning to executing and moved focus to where it needs to be — on the H&M brand,” Daniel Schmidt, an analyst at Danske Bank, said in a phone interview. He has a buy recommendation on H&M’s stock.

Recent share purchases by furniture giant Ikea’s investment company Interogo Holding are also providing a floor for the stock, amid speculation that it could become a large long-term owner, Schmidt said. Ikea “could be an ideal partner” if Persson chooses to take the company private, he said.

Speculation about a potential buyout by Persson has been rife this year after the chairman increased his stake in H&M in conjunction with his dividend payments from the fashion retailer.

While investors are warming to H&M’s stock, most analysts remain unconvinced. A majority still advise clients to sell, and only two of the 32 analysts that cover H&M and are tracked by Bloomberg have buy recommendations.

What’s more, the average price target calls for the shares to drop some 17 percent in the coming 12 months. The company’s return potential has been negative for almost the entire year.

And, to be sure, H&M is still more than 50 percent below its peak in 2015.

By Niklas Magnusson and Anna Molin; editors: Tasneem Hanfi Brögger, Eric Pfanner, John J. Edwards III and John Lauerman