Forward Air considering Omni deal break a positive for stock, says Stephens

After Forward Air announced the dissolution of the TRO and dismissal of the lawsuit that was blocking the pending Omni Logistics merger from closing, but also announced it is considering exercising its right to terminate the merger as it believes that Omni has been non-compliant with certain obligations stated in the merger agreement related to preclosing access to information and confidentiality and financing, Stephens said the firm believes this update will be a positive for the stock given “the visceral reaction from shareholders following the merger announcement.” However, the firm sees the potential for litigation around this decision, as well as the potential for Omni to divert freight based on this development, the analyst added. While the firm maintains an Overweight rating on Forward Air, its estimates and $85 price target are under review given the latest news.