- Harte-Hanks (NYSE:HHS) is up 4% as BMO Capital points to its dividend yield (and a possible buyback) in upgrading shares to Outperform, from Market Perform.
- Analyst Daniel Salmon has a price target of $7 on the stock; it closed yesterday at $4.95 and is currently trading at $5.16.
- The stock's felt pressure this month due to a lack of strategic update since CEO Robert Philpott exited his post, Salmon says, but despite challenged fundamentals, "the risk/reward is incrementally positive."
- "Most importantly –- and in part due to high inside ownership -– we believe the current dividend is safe, and it’s also currently yielding just short of 7%," he says. "Moreover, we believe there is increased likelihood of some nominal share buyback; our main question would be if management would consider incremental borrowing (either on bank facilities or issuance of new debt) or simply use excess FCF."
- A management-led LBO isn't out of the question either, he says: Interim CEO and current CFO Doug Shepard has experience taking companies private.