Citigroup is out positive on Saks (NYSE:SKS) noting that as reported in Baugur's 13 D/A filing (6/11/08), Baugur has further consolidated and/or rolled over its previously disclosed forward contracts for SKS shares into new forward contracts maturing on 7/30/08. The consolidated forward contract prices now range from $12.1796 to $23.1078 per share.
The Firm views this news as an incremental positive for its investment thesis on SKS as it increases confidence that there is a probability of a takeout deal in SKS's future.
Citi reiterates Buy rating and $20 target price for SKS.
Notablecalls: Baugur and Landmark (Dubai based retailing group) currently own about 10% of SKS's outstanding common shares. The price range in Baugur's case surely points to a healthy upside currently not appreciated by the market. I think SKS stock can move higher from here.