After rejecting offers from Jos. A. Bank, Men's Wearhouse is now bidding on its pursuer. But, is Men's Wearhouse offering too much for Jos. A. Bank?
The NASDAQ may be acting like a throwback to the 1990s but the folks over at Men's Wearhouse are getting really retro – they're playing Pac-Man.
Specifically, they're taking on what's known as the "Pac-Man defense" against would-be suitor, Jos. A Bank.
No, Men's Wearhouse's board isn't taking time off to play video games. Rather, the "Pac-Man defense" refers to a manoeuver whereby a target company turns around and offers to buy the company pursuing it. That's kind of like when Pac Man, being chased by ghosts, eats a power pellet and is able to gobble up those very ghosts. [Fun fact: Those too young to remember Pac-Man are generally too young to remember the stock market bubble collapse of 2000.]
After rejecting bids from rival discount clothier Jos. A Bank, Men's Wearhouse has turned the tables, offering to purchase Jos. A. Bank instead. Men's Wearhouse's offer of $55 per share is the price of a traveler dress shirt at Jos. A. Bank. The total amount comes to $1.5 billion, or roughly the price of three similar dress shirts at Barney's.
But, is Men's Wearhouse offering too much for Jos. A. Bank?
On CNBC's Street Signs' Talking Numbers segment, Jos. A. Bank is looked at from both the technicals and fundamentals.
Taking a look at the stock's fundamentals is John Stephenson, portfolio manager at First Asset Investment Management. On the charts is Andrew Busch, editor and publisher of The Busch Update.
To see if Stephenson and Busch think Jos. A. Bank suits your portfolio, watch the video above.
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