Circuit City Trading Near Lowest Level in Over Two Years
The AP reports that Circuit City shares were trading at $15.77 Wednesday. This is below the $17 buyout offer tendered by a Boston hedge fund two years ago. The drop also comes in the wake of a 3,500-employee layoff.
Bear Stearns analyst Christopher Horver told the AP that a $22 to $24 per share buyout price could be profitable for an interested buyer. USB AG analyst Brian Nagel has expressed similar sentiments about the company’s attractiveness to buyers. Buyout fever has been tempered, however, by a profit warning issued by Circuit City on April 30 that blamed “substantially below-plan sales” for a revised pretax loss estimate of nearly $100 million in the first quarter.
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