Blackhawk Network Holdings (NASDAQ:
) is the largest distributor of prepaid gift cards, representing
over 500 brands in more than 100,000 locations. Gift cards are
sold primarily in grocery and convenience stores, with nine of
the top ten grocery stores as distributors.
Before the IPO in April, Blackhawk was entirely owned by
), which still controls a considerable amount of the company.
Although shares spiked when first offered, they have dropped
almost five percent since since the IPO.
Despite this decrease in share price, analysts are largely
bullish on the company. On Tuesday, Deutsche Bank, Piper Jaffray,
Goldman Sachs and Bank of America initiated coverage on the
company with three positive ratings, and one neutral,
respectively. Price targets range from $27.00 to $29.00.
Analysts cited growth in distribution channels and content as
primary reasons for expansion. One way Blackhawk plans to further
penetrate domestic distributors and retailers is by expanding the
use of loyalty programs. In addition, the company is adding
content from local and regional merchants, a market with notably
In addition to these growth opportunities, analysts predict
significant international expansion as more than 80 percent of
the company's revenue is from the United States
Shares closed down Tuesday at $24.70.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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