Why Vitacost.com, Inc. Stock Skyrocketed
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 Vitacost.com soared 27% today after supermarket giant Kroger agreed to acquire the online vitamin seller for about $280 million.
So what: The all-cash deal values Vitacost at $8 per share and represents a premium of 27% to its closing price on Tuesday. Kroger is making the move to expand its presence in online retailing and, judging by its own stock's flat trading today, Mr. Market isn't too upset with the price that management is paying to do it.
Now what: The transaction is expected to close in the third quarter of 2014. "Vitacost.com's core focus on healthy living products is complementary to our fast-growing natural foods business, and we intend to grow Vitacost.com's strong position in the online nutrition market," said Kroger CEO Rodney McMullen. "At the same time, we will build on Vitacost.com's eCommerce platform by integrating it with our existing digital offerings to create exciting new levels of personalization and convenience for our customers." So while Vitacost is likely all popped out at this point, Kroger's strengthening Internet presence might be worth looking into.
Breaking: This small-cap stock is poised to soar higher
Growth stocks jump up and down on a daily basis, but the smartest investors know the path to riches is finding these big winners early. The mission of The Motley Fool's Rule Breakers team is to identify these once-in-a-generation stocks. This team of analysts recommended Baidu in 2006 (up +2,000%) and Chipotle in 2007 (up +800%). And luckily for you (and their thousands of existing members), the team believes it has found its next big winner. Click here for your copy of this timely report.
The article Why Vitacost.com, Inc. Stock Skyrocketed originally appeared on Fool.com.Brian Pacampara has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.