Jo-Ann Stores
(NYSE:JAS) moved up $0.99, or 3.29%, to $31.05 today after the company
announced positive earnings for the quarter. The specialty retailer
announced a net loss of $0.07 per diluted share compared to $0.28 per
diluted share a year ago. Same-store sales - or comps - increased 1.8%
this quarter compared to a loss of 3.9% a year ago.
Investors
are also carefully watching the bidding process for the company, which
may end up topping $1 billion. The group of bidders reportedly consists
of middle-market private
equity firms including Leonard Green & Partners and Freeman Spologi
& Co. There are also reports that larger firms like Blackstone may
be looking at the company. Final bids, however, are expected to be in
by June when Lehman Brothers will then evaluate them along with the
board of directors.
But
just how much could the company fetch? Well, the company's improving
margins and growth prospects may certainly increase the final bidding
price. The company's main competitor, Michael's Stores, was also
recently acquired for 12.8x EBITDA and a 30% premium to the stock's
closing price on the day it announced that it was exploring strategic
alternatives. These metrics seem to confirm the fact that the Jo-Ann
could fetch a nice premium. This makes JAS a stock
worth watching!
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