Shares of bookseller Barnes & Noble, Inc. (
) rose sharply in premarket trading Wednesday, after the company
announced late Tuesday that it is exploring options for a potential
The New York-based company, which has struggled along with other
brick-and-mortar booksellers under economic pressures and the
technology shift away from paper books, said it could sell its
famous chain to an investment group that includes its founder and
largest shareholder, Leonard Riggio.
B&N said it is evaluating multiple options to help boost
shareholder value. It noted that a committee of four directors will
explore its options, and that it hired Lazard as its financial
adviser during the process.
Barnes & Noble shares rose $3.26, or +25%, in premarket
The Bottom Line
We have been avoiding shares of BKS since our early June 2008
coverage began, when the stock was trading at $27.31. The company
has an unsustainable 7.79% dividend yield, based on last night's
closing stock price of $12.84. The stock has technical support in
the $11 price area, which are approaching all-time lows. If the
shares can firm up, we see overhead resistance around the $16-$18
price levels. We would remain on the sidelines for now.
Barnes & Noble, Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.1 out of 5 stars.
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