Canaccord Genuity Morning Coffee on Avon Products (NYSE: AVP): Even Concealer Can't Fix This Mess
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Price: $23.45 +0.26%
Rating Summary:
4 Buy, 12 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 1 | New: 1
Rating Summary:
4 Buy, 12 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 1 | New: 1
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Canaccord Genuity Morning Coffee on Avon Products (NYSE: AVP): Even concealer can't fix this mess.
Yesterday, shares of Avon plummeted after Coty withdrew its unsolicited $10.7-billion bid, bringing to an end a tense six-week stand-off between the fragrance maker and the direct seller of cosmetics. The withdrawal of the bid came as the deadline Coty set for Avon to respond to its sweetened offer expired. Last week, Coty raised its bid and brought in Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A) to help provide financing, saying it would give Avon until Monday night to enter into discussions about a possible deal. Avon on Sunday said it would consider the raised bid and respond to Coty within a week. While Coty claimed Avon was unengaged and that "two months was enough", the makeup seller said it actually replied promptly but “five days after sending its letter, Coty withdrew its proposal.” If the current prices hold, Avon shares will be worth less than when Coty made its original offer back in April. Profits have been shrinking for three years and Avon is suffering even in places it had seen as strongholds. Without the buyout, Avon's new CEO, Sheri McCoy, a former Johnson & Johnson (NYSE: JNJ) executive, will have to come up with an alternative plan to turn the company around amid worsening results and bribery claims.
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Yesterday, shares of Avon plummeted after Coty withdrew its unsolicited $10.7-billion bid, bringing to an end a tense six-week stand-off between the fragrance maker and the direct seller of cosmetics. The withdrawal of the bid came as the deadline Coty set for Avon to respond to its sweetened offer expired. Last week, Coty raised its bid and brought in Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A) to help provide financing, saying it would give Avon until Monday night to enter into discussions about a possible deal. Avon on Sunday said it would consider the raised bid and respond to Coty within a week. While Coty claimed Avon was unengaged and that "two months was enough", the makeup seller said it actually replied promptly but “five days after sending its letter, Coty withdrew its proposal.” If the current prices hold, Avon shares will be worth less than when Coty made its original offer back in April. Profits have been shrinking for three years and Avon is suffering even in places it had seen as strongholds. Without the buyout, Avon's new CEO, Sheri McCoy, a former Johnson & Johnson (NYSE: JNJ) executive, will have to come up with an alternative plan to turn the company around amid worsening results and bribery claims.
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