Why Jones Group Shares Popped
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Jones Group were riding higher today, gaining as much as 16% on reports that the apparel-and-footwear seller may be seeking a buyer.
So what: The parent of Nine West and Jones New York has retained Citigroup to explore a possible sale, according to Reuters. Jones Group has been struggling, recently announcing that it will close about 170 underperforming stores in the next year and lay off 8% of its workforce. The retailer had also previously looked into selling itself in 2006 but couldn't find an interested party.
Now what: That record doesn't instill confidence in the company's appeal as an acquisition target. Factor in its shares' hitting a nearly three-year high on today's news, and the company seems even less desirable for a buyer. Sales have also flatlined as the brands have stagnated. Following the afternoon pop, shares cooled off to finish up 7.6%, but again, any gains from the report will only serve as a disincentive to a potential buyer. I wouldn't get my hopes up. To follow this developing story, all you need to do is add Jones Group to your Watchlist here.
The article Why Jones Group Shares Popped originally appeared on Fool.com.
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