Benchmark Maintains a 'Buy' on Big Lots (BIG); Stock Trades Down as Take Out Rumors End
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Price: $0.50 --0%
Rating Summary:
9 Buy, 15 Hold, 6 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 5 | Down: 4 | New: 11
Rating Summary:
9 Buy, 15 Hold, 6 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 5 | Down: 4 | New: 11
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Benchmark maintains a 'Buy' on Big Lots (NYSE: BIG), PT $50.
Benchmark analyst says, "Yesterday the stock traded down over 10% as the media reports that Big Lots decided not to sell itself. We maintain our $50 price target based on 16x our 2011 EPS estimate of $3.13 and 7.5x our 2011 EBITDA estimate, as our price target did contain a take out premium. We believe management was looking for a multiple similar to Family Dollar’s unsolicited offer of 9.3x 2011E EBITDA, or the 10 multiple Dollar General (NYSE: DG) received from KKR."
"Given the solid balance sheet, cash flow, profitability, and management execution in a challenging environment, we contend that the shares show value, trading at a discount to its historic multiple of 16x-18x. We believe over the past couple years, Big Lots has improved its store base, and could continue in the current retail real estate market further improving its store base and expanding it customer base, which could lead to years of revenue growth."
For more ratings news on Big Lots click here and for the rating history of Big Lots click here.
Shares of Big Lots closed at $33.77 yesterday.
Benchmark analyst says, "Yesterday the stock traded down over 10% as the media reports that Big Lots decided not to sell itself. We maintain our $50 price target based on 16x our 2011 EPS estimate of $3.13 and 7.5x our 2011 EBITDA estimate, as our price target did contain a take out premium. We believe management was looking for a multiple similar to Family Dollar’s unsolicited offer of 9.3x 2011E EBITDA, or the 10 multiple Dollar General (NYSE: DG) received from KKR."
"Given the solid balance sheet, cash flow, profitability, and management execution in a challenging environment, we contend that the shares show value, trading at a discount to its historic multiple of 16x-18x. We believe over the past couple years, Big Lots has improved its store base, and could continue in the current retail real estate market further improving its store base and expanding it customer base, which could lead to years of revenue growth."
For more ratings news on Big Lots click here and for the rating history of Big Lots click here.
Shares of Big Lots closed at $33.77 yesterday.
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