Activist investor Ancora Alternatives LLC believes Forward Air Corp.'s stock could double if shareholders vote against the Omni Logistics deal, leading to potential increases in stock value.
Shares of Forward Air Corp. (FWRD) experienced a significant boost in morning trading on Tuesday, following a statement made by activist investor Ancora Alternatives LLC. Ancora, which is currently one of the top shareholders of Forward Air, believes that the value of the less-than-truckload and freight services company could nearly double if shareholders take decisive action.
According to Ancora, if shareholders vote against the cash-and-stock deal to acquire Omni Logistics LLC, which was announced on August 10th, and subsequently vote for a replacement of the board of directors and management team, the stock has the potential to trade at over $100 within the next six months. Further, Ancora predicts that these actions could lead to an intermediate-term increase in stock value, bringing it to a range of $140 to $145, representing a substantial 80% to 86% rise above current levels.
The stock had previously suffered a significant decline of 42.4% due to a six-day losing streak that coincided with the announcement of the Omni deal. The downward trend prompted Stifel to downgrade Forward's stock from a buy rating to hold, citing concerns about the deal price, substantial equity dilution, and sizable execution risks.
Year to date, Forward's stock has fallen by 25.7%, while the Dow Jones Transportation Average has climbed 13.4% and the Dow Jones Industrial Average has seen a modest increase of 2.8%.
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