Barclays downgrades JD Sports on Hibbett acquisition
By Michele Maatouk
Date: Monday 29 Apr 2024
(Sharecast News) - Barclays downgraded JD Sports on Monday to 'equalweight' from 'overweight' and cut the price target to 140p from 165p after the retailer announced the acquisition of US rival Hibbett last week for $1.1bn.
JD Sports said it would pay $87.50 a share in cash for Hibbett stock.
"Companies cannot choose the perfect time to do deals, but we believe that rebuilding a track record would have been preferable before spending circa £900m on another acquisition, especially given concerns over Nike's innovation," Barclays said.
Headquartered in Birmingham, Alabama, Nasdaq-listed Hibbett has 1,169 stores in 36 states across the US trading under the Hibbett and City Gear fascias.
At 1025 BST, JD Sports shares were down 1% at 118.95p.
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