Chico’s FAS Shares See Boost on Going Private Chatter

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By Trey Thoelcke Published
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Shares of retailer Chico’s FAS Inc. (NYSE: CHS) were sharply higher Tuesday on chatter about the company potentially going private. The Financial Times said Monday that Chico’s was in talks in recent weeks with “several private equity groups,” but that discussions are in the preliminary stages. Speculation was that the U.S. womenswear chain operator could command a premium of up to 30% to its $2.36 billion market capitalization.

Private equity group Leonard Green took a 1.3% stake in the retailer in April and could be a potential buyer for the entire Chico’s business or a potential partner. Leonard Green also owns stakes in other retailers, including J. Crew and Sports Authority.

At the end of May, Chico’s reported first-quarter profits that were down 22% from a year earlier and short of consensus expectations. Same-store sales fell 2.6%, though total revenue edged 1.6% higher to $681.6 million but also missed estimates. Higher costs and expenses more than offset the benefit of an improved top line. The company also cited lower traffic due to inclement weather, a familiar refrain from the most recent reports from retailers.

Chico’s also said it would scale back its planned store expansion program from an earlier projection of 120 to 130 new stores and outlets during the fiscal year to just 107 stores.

Shares were up more than 10% to $17.07 in early trading on heavy volume, pushing the market cap up to about $2.5 billion. More than 7 million shares had traded hands by late morning, compared with a recent daily average of less than 2.5 million. The 52-week range is $14.90 to $19.84.

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About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

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