Olstein Says His PetSmart Holdings Are Worth Up To $90 Per Share
PetSmart (NASDAQ: PETM) is likely to be acquired by a competitor for $85 to $90 per share, according to a fund manager with a significant position in the stock
Robert Olstein of Olstein Capital Management appeared on CNBC Thursday to make the assertion that PetSmart, target of activist investor Barry Rosenstein, will be acquired at a price far higher than its current stock value.
PetSmart traded recently at $67.44 per share, up nearly 13 percent.
Rosenstein revealed earlier Thursday that he had acquired a 9.9 percent stake in the company and would ask management to make a "strategic review" to include a possible sale.
"It's one of our largest positions," said Olstein, who is not affiliated with Rosenstein. "This stock's going higher and I believe it will be taken out."
Olstein acknowledged that short-covering may be in part driving the stock Thursday.
Short sellers hold about 17 percent of the company's public float of 98 million shares.
"I don't understand why anybody would be short on this stock" Olstein said. "Here's a company, yes, they don't grow eight to nine percent; they're growing at at two to three percent."
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