Buffalo Wild Wings (bwld) shares rose nearly 26% in premarket trading on Tuesday, a day after a report that the company received a $2.3 billion takeover bid from private-equity firm Roark Capital Group.
Roark made an offer of more than $150 per share, a premium of at least 28% to the fast food chain‘s close on Monday.
Analysts at Wedbush, which boosted their price target to $130 from $115, said the offer is realistic and that Buffalo’s management could view it favorably with the stock’s current price representing limited visibility into same-store sales growth and margin trajectory.
“We believe a premium is now warranted given the potential for upside to expectations if wing cost declines are sustained, but remains a discount to M&A multiples given uncertainty regarding any potential deal.”
The Wall Street Journal first reported the news on Monday, citing people familiar with the matter.