Monro Muffler Brake, Inc.NASDAQ
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  • Dec. 24, 2015, 10:02 AM
    • Pep Boys' (PBY -0.2%) bidding process will continue into the new year, culminating with a breakup of the service and retail operations and Monro Muffler (MNRO -0.5%) or O'Reilly Auto Parts (ORLY -0.1%) as potential buyers, Sterne Agee CRT analyst Ali Faghri says, adding that a deal with either company would be a positive catalyst since both have strong track records of acquisition integration.
    • Faghri says an Icahn Enterprises (IEP -0.1%) acquisition of PBY likely would result in a sale of the service operations, with MNRO as a potential buyer; should Bridgestone prevail, PBY's retail business would be viewed as non-core and the ~560 stores would be sold, with ORLY the mostly likely buyer in this scenario.
    • At an $18.10 takeout price, the analyst says the current deal valuation of ~12.5x TTM EBITDA shows the strength of the auto aftermarket industry, justifying MNRO's premium valuation (~14x 2016 EBITDA) and underscoring the discount at which Advanced Auto Parts (AAP +0.1%) trades (~9x 2016 EBITDA).
    | Dec. 24, 2015, 10:02 AM | 7 Comments