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Ruby Tuesday crushed, but buyout intrigue lingers

Published 04/07/2017, 09:19 AM
© Reuters.  Ruby Tuesday crushed, but buyout intrigue lingers
  • Ruby Tuesday (NYSE:RT) is down sharply after FQ3 results disappoint.
  • Same-restaurant sales fell 4% during the quarter to decelerate from the 3.1% drop in FQ2. Restaurant margin dropped 130 bps to 15.8% as some sales leverage peeled away.
  • "The casual dining environment remains highly challenging, promotional, as well as price competitive and our sales trends are reflective of these conditions," notes outgoing interim CEO Lane Cardwell.
  • Management confirms that board is still exploring strategic alternatives, including a potential sale.
  • Wall Street analysts are ignoring Ruby Tuesday, but Seeking Alpha contributor Michael Wiggins De Oliveira thinks the market isn't pricing in a likely buyout.
  • RT -11.43% premarket vs. a 52-week trading range of $1.69 to $5.39.


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