At the industry’s historical takeover multiple of 10.2 times Ebitda for deals of at least $500 million, an acquisition of Big Lots would value the equity at $4.6 billion, based on analysts’ profit estimates for this fiscal year. That would represent a per-share price of about $61, almost double the average price of $32.06 in the 20 days prior to Feb. 7.
Those numbers are realistic; my research on this stock goes back 4 years and I've been investing in the 4Q pattern for 3. The possible sale only enhances the profit this time. BIG has been considered a buyout target for several years with interest increasing when it performed through the recession.
The only negative here is that if the company goes private or becomes part of a conglomerate, the pattern that has made us money each year will no longer exist. I'm in for well over 100 grand this time, but was planning to go twice as big next year. May not have that opportunity!
I wouldn't count on anything. I owned Claires just before it sold. I bought at 33, they anounced after 4th qtr that they were up for sale because the sisters were tired of the business. They sold at 31 or 32 which was way low. Everyone was surprised. I really don't understand the sale though. Fishman is still fairly new to the job, took the company to much higher levels, so all he has left is to sell the company? Bad decision. Either that or he doesn't know how to grow a company sizewise. He's raised the ring, cut the expenses and now he's calling it quits.