Talbots (TLB) May Get More Takeover Bids, Could Fetch More than $3/Share
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Talbots (NYSE: TLB) shares have popped Friday afternoon, following reports that some private-equity firms are weighing bids for the company.
According to CNBC, TPG, Golden Gate, and others, may be weighing a bid to take over the battered women's apparel maker. Should shares really be surging though?
Earlier in December, firm Sycamore Partners placed a bid to acquire Talbots for $3.00 per share, sending the stock to, you guessed it, $3.00 per share. When Sycamore submitted its bid, on December 6th in a 13D filing, shares popped, and stayed around $2.75 when Tablots rejected the bid.
In the same release, Talbots said its Board "has resolved to explore a full range of strategic alternatives to maximize value for Talbots stockholders."
The company still doesn't have a CEO, who stepped down on December 5th.
Really, since shares hovered around the $2.75 level, investors and traders have been expecting a price near that level. But Talbots might garner more, and here's a few reasons why:
Over the last two-years, shares have dropped well over 80 percent from highs at or above $16. The outlook for Talbots is improving too, with analysts expecting a loss of $1.17 per share for 2011 will just about halve to 63 cents for 2012. Even Talbots upcoming loss expectations will fall from 52 cents to just 4 cents per share quarter-over-quarter, a sign of improving times.
Last quarter, Talbots also said it "is implementing a cost reduction initiative in the fourth quarter of 2011, which is expected to generate approximately $50 million in annualized cost savings across all areas of the business to be completed by the end of fiscal 2012."
It's cash position improved last quarter from $2.38 million to $19.25 million, while some liabilities fell. Talbots did draw from its credit facility, and A/P also saw an increase, but that might have been prepping for the holiday 2011 shopping season.
There's obviously more metrics like comparable-store sales trends, tangible book, sales-per-square-foot, and more to be evaluated over a greater period of time, but the above is a start.
So, whether Talbots will go for $3, $6, or $12 per share is up in the air. With shares above $3.00, it looks as though investors are hoping for more.
According to CNBC, TPG, Golden Gate, and others, may be weighing a bid to take over the battered women's apparel maker. Should shares really be surging though?
Earlier in December, firm Sycamore Partners placed a bid to acquire Talbots for $3.00 per share, sending the stock to, you guessed it, $3.00 per share. When Sycamore submitted its bid, on December 6th in a 13D filing, shares popped, and stayed around $2.75 when Tablots rejected the bid.
In the same release, Talbots said its Board "has resolved to explore a full range of strategic alternatives to maximize value for Talbots stockholders."
The company still doesn't have a CEO, who stepped down on December 5th.
Really, since shares hovered around the $2.75 level, investors and traders have been expecting a price near that level. But Talbots might garner more, and here's a few reasons why:
Over the last two-years, shares have dropped well over 80 percent from highs at or above $16. The outlook for Talbots is improving too, with analysts expecting a loss of $1.17 per share for 2011 will just about halve to 63 cents for 2012. Even Talbots upcoming loss expectations will fall from 52 cents to just 4 cents per share quarter-over-quarter, a sign of improving times.
Last quarter, Talbots also said it "is implementing a cost reduction initiative in the fourth quarter of 2011, which is expected to generate approximately $50 million in annualized cost savings across all areas of the business to be completed by the end of fiscal 2012."
It's cash position improved last quarter from $2.38 million to $19.25 million, while some liabilities fell. Talbots did draw from its credit facility, and A/P also saw an increase, but that might have been prepping for the holiday 2011 shopping season.
There's obviously more metrics like comparable-store sales trends, tangible book, sales-per-square-foot, and more to be evaluated over a greater period of time, but the above is a start.
So, whether Talbots will go for $3, $6, or $12 per share is up in the air. With shares above $3.00, it looks as though investors are hoping for more.
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