Shares of surface flooring and accessories provider LL Flooring Holdings (NYSE:LL) are tanking today after Founder Tom Sullivan withdrew his $5.76 per share takeover bid for the company due to its deteriorating financial and operational performance.
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Sullivan made the acquisition offer in May this year through the F9 Group and Cabinets to Go (CTG) in a bid to combine LL and CTG. LL rejected the proposal in June, as it “significantly” undervalued the company.
Earlier this week, LL announced that it was exploring strategic alternatives, including a potential sale, merger, or other combinations. The company has not set a deadline for the completion of this process.
Having gone from consistent profitability to a negative bottom line last year, LL is expected to incur a net loss per share of $2.83 in 2023 versus an EPS of $1.39 in 2021.
In sync, shares of the company have cratered by nearly 62% over the past year. Meanwhile, Loop Capital Markets’ Laura Champine, the lone analyst covering LL, has reiterated a Sell rating on the stock alongside a $2 price target. This implies a further ~50% potential downside in LL shares.
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