6 Stocks Hit 52-Week Lows: BBY, JRCC, FSLR, NFX, SWN, XCO
NEW YORK (TheStreet) -- The following stocks hit 52-week lows on Monday: Best Buy(BBY) , First Solar(FSLR) , James River Coal(JRCC) , Newfield Exploration(NFX) , Southwestern Energy(SWN) and EXCO Resources(XCO) .
"Our LBO model shows that on a paper a deal is feasible at a price in the high $30 range, but, for the reasons listed below, we think a deal is unlikely: 1) Market share losses and increased competition would make it difficult for a buyer to stabilize comps and margins. Comps have fallen 2 years in a row and margins fell 50 bps last year. 2) The chairman Richard Schulze owns just under 20% and may be an unlikely seller. 3) At a high $30 range, the deal would require nearly $11b in debt and $5b in equity, bigger than recent LBO's in the space, which would make it difficult," Deutsche Bank analysts wrote in an April 18 report.
Shares of Best Buy hit a 52-week low on Monday of $21.31. The stock's 52-week high of $32.85 was set on June 21.
Best Buy trades at an estimated price-to-earnings ratio for next year of 5.78 times; the average for specialty retailers is 15.84. For comparison, GameStop(GME) has a higher forward P/E of 6.46.