Bob Evans Up After Announcing It Will Explore Strategic Transactions

Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

Bob Evans Farms Inc BOBE shares are trading higher by $1.47 at $47.57 in Friday's session. Before the open, the company announced it will pursue a strategic transaction that will be either a sale-leaseback or tax-free REIT conversion spin-off.

The move prompted Miller Tabak to upgrade the issue from Hold to Buy.

Off the open, it immediately found resistance at $48.57 and retreated to $47.02 before rebounding to its current level. The current high marks the highest level since its disastrous day on March 4 when it swooned from $59.64 to $46.36 after the company reported a Q4 earnings and sales miss.

In addition, it coincides with its high from that day at $48.46.

It was unable to manage a rebound until it put in a pair of lows on April 30 ($42.93) and May 1 ($43.04). The stock had been grinding higher until the recent announcement pushed the stock temporarily back over $48.

Friday's price action is taking place on much higher than average volume. So far, 1.1 million shares have changed hands compared with 20-day average of 317,000 in the final hour of the session.