Bill Maurer
Long/short equity, long only, short only, growth

Crocs Buyout Upside Enormous, But Is It Logical?

Recently, shares of footwear retailer Crocs (NASDAQ:CROX) popped after reports that the company was exploring strategic alternatives, including a buyout. This helped shares to rally off their 52-week low of $11.96, set just a couple of weeks ago. There is no doubt that a buyout of Crocs would deliver tremendous upside to shareholders. Stifel Nicolaus has suggested that a leveraged buyout could fetch $16 to $18, which would represent 17.47% to 32.16% upside from Thursday's closing price. The question for investors is does a buyout make sense, and today, I'll explain why buyout prospects are not as rosy as they seem.

Why buy out / take private Crocs?

Let me start out by explaining a couple...

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