Build-A-Bear Workshop Inc.
(NYSE:BBW) shares rose $3.39, or 15.06%, to $25.90 today after the
company announced that it hired Lehman Brothers to explore strategic
alternatives after a relatively bad quarter for the retailer. Chairman
and CEO Maxine Clark, however, said that the company remains highly
profitable in a unique retail-entertainment niche that will continue to
grow.
Build-A-Bear warned last week that its earnings and
revenues for the quarter would fall short of projections while its
same-store sales were projected to drop from 9% to 7%. The company
blamed higher advertising costs, high performanced-based executive
compensation and language translation costs from new store openings
abroad.
A company spokesperson said that it has an obligation to
shareholders to explore a range of strategic alternatives that could
help unlock value in their investments. Meanwhile, shareholders are
betting that the company will either decide to sell off some of its
extraneous investments such as that in Retail Entertainment Concepts.
Others are hoping that the company will decide to put itself up for
sale in an environment that is extremely conductive to high-priced
buyouts. Either way, BBW is definitely a
stock to watch over the next few months!
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