Post-Pearson investment, the BKS stake in NOOK is now worth $1.4 billion
In fact, NOOK's overall valuation (based on the Pearson 5% purchase) is up almost $100mil post MSFT investment - from $1.7bil to $1.8bil. So BKS's 78.2% stake in NOOK is now worth $23.75 per share standalone. Now, if you add the value of the retail books business, $820mil @ projected cash flow multiple of 3.5 minus $500mil debt and preferred - the value of the retail books div is $14 per share. In summary, fair value is $35-40 - and with an imminent NOOK spin-off TBA, the market will reward BKS shareholders with an instant PPS spike to $35.