Baird Says Reported Shutterfly Offer Is 15% Too Low
Shutterfly (NASDAQ: SFLY) is unlikely to consider a reported $2 billion bid from private equity firm Hellman & Friedman, according to an analyst.
Other private investors are also interested in the Internet-based photo services company, according to a report Wednesday by Bloomberg and others, which said a deal could be announced early next month.
Shutterfly, with a market capitalization of about $1.89 billion, would fetch around $52 a share in the reported offer, which the company hasn't confirmed.
Robert Baird's Colin Sebastian rates the shares at Buy with a $55 target, and said Shutterfly would be likely to consider offers "closer to $60 a share," or about 15 percent higher than the reported bid.
Assuming Shutterfly is seeking offers, Sebastian said a private equity buyer or possible management buyout would be more logical than a so-called strategic buyer.
Sebastian said a public company's constraints on funding long-term investments in technology make a going-private scenario desirable to Shutterfly management.
Shutterfly closed Wednesday at $50.47 a share, up 1.26 percent.
Latest Ratings for SFLY
|May 2014||Raymond James||Maintains||Outperform|
|Apr 2014||Goldman Sachs||Upgrades||Neutral||Buy|
|Mar 2014||Cowen & Company||Downgrades||Outperform||Underperform|
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