Hostess Brands Inc. [NASDAQ: TWNK] stock went on an upward path that rose over 19.14% on Monday, amounting to a one-week price increase of more than 18.21%. The company report on September 11, 2023 at 8:00 AM that Hostess Brands to Be Acquired by the J.M. Smucker Co. for Approximately $5.6 Billion.
Hostess Brands, Inc. (Nasdaq: TWNK) (the “Company” or “Hostess Brands”), announced today that it has entered into a definitive agreement with The J.M. Smucker Co. (NYSE: SJM) to acquire all of the outstanding shares of Hostess Brands in a cash and stock transaction valued at $34.25 per Hostess Brands share, representing a transaction value of approximately $5.6 billion, including the assumption of debt. Under the terms of the agreement, Hostess Brands shareholders will receive $30.00 in cash and 0.03002 shares of The J.M. Smucker Co. common stock (valued at $4.25 as of September 8, 2023) for each share of Hostess Brands common stock. The purchase price represents a premium of approximately 54% to the closing price of $22.18 on August 24, 2023, the last trading day prior to press reports of a potential transaction.
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Andy Callahan, President and Chief Executive Officer of Hostess Brands commented, “I am extremely proud of the entire Hostess Brands team for the legacy they created in building a premier snacking company and driving industry leading returns for our investors. Today represents another exciting chapter for our company as we combine our iconic snacking brands with The J.M. Smucker Co.’s family of beloved brands. We believe this is the right partnership to accelerate growth and create meaningful value for consumers, customers and shareholders. Our companies share highly complementary go-to market strategies, and we are very similar in our core business principles and operations. Above all else, Hostess Brands and The J.M. Smucker Co. share a deep commitment to inspiring moments of joy and satisfaction through our products, and we look forward to continuing to do so as part of The J.M. Smucker Co. family.”.
Over the last 12 months, TWNK stock rose by 43.18%. The one-year Hostess Brands Inc. stock forecast points to a potential downside of -15.96. The average equity rating for TWNK stock is currently 2.10, trading closer to a bullish pattern in the stock market.
The market cap for the stock reached $4.41 billion, with 133.08 million shares outstanding and 129.77 million shares in the current float. Compared to the average trading volume of 1.51M shares, TWNK stock reached a trading volume of 33466739 in the most recent trading day, which is why market watchdogs consider the stock to be active.
Guru’s Opinion on Hostess Brands Inc. [TWNK]:
Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for TWNK shares is $28.88 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on TWNK stock is a recommendation set at 2.10. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.
JP Morgan have made an estimate for Hostess Brands Inc. shares, keeping their opinion on the stock as Neutral, with their previous recommendation back on August 31, 2023.
The Average True Range (ATR) for Hostess Brands Inc. is set at 1.15, with the Price to Sales ratio for TWNK stock in the period of the last 12 months amounting to 3.19. The Price to Book ratio for the last quarter was 2.41, with the Price to Cash per share for the same quarter was set at 0.75. Price to Free Cash Flow for TWNK in the course of the last twelve months was 42.75 with Quick ratio for the last quarter at 1.50.
TWNK Stock Performance Analysis:
Hostess Brands Inc. [TWNK] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 18.21. With this latest performance, TWNK shares gained by 44.92% in over the last four-week period, additionally plugging by 38.79% over the last 6 months – not to mention a rise of 43.18% in the past year of trading.
Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for TWNK stock in for the last two-week period is set at 86.22, with the RSI for the last a single of trading hit 90.75, and the three-weeks RSI is set at 81.85 for Hostess Brands Inc. [TWNK]. The present Moving Average for the last 50 days of trading for this stock 24.91, while it was recorded at 29.10 for the last single week of trading, and 24.64 for the last 200 days.
Insight into Hostess Brands Inc. Fundamentals:
Operating Margin for any stock indicates how profitable investing would be, and Hostess Brands Inc. [TWNK] shares currently have an operating margin of +16.42 and a Gross Margin at +32.21. Hostess Brands Inc.’s Net Margin is presently recorded at +12.09.
Return on Total Capital for TWNK is now 7.92, given the latest momentum, and Return on Invested Capital for the company is 5.85. Return on Equity for this stock inclined to 9.34, with Return on Assets sitting at 4.69. When it comes to the capital structure of this company, Hostess Brands Inc. [TWNK] has a Total Debt to Total Equity ratio set at 55.81. Additionally, TWNK Total Debt to Total Capital is recorded at 35.82, with Total Debt to Total Assets ending up at 28.52. Long-Term Debt to Equity for the company is recorded at 55.60, with the Long-Term Debt to Total Capital now at 35.68.
Reflecting on the efficiency of the workforce at the company, Hostess Brands Inc. [TWNK] managed to generate an average of $58,641 per employee. Receivables Turnover for the company is 8.49 with a Total Asset Turnover recorded at a value of 0.39.Hostess Brands Inc.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.50 and a Current Ratio set at 1.80.
TWNK Stock EPS
The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for TWNK. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Hostess Brands Inc. go to 9.10%.
Hostess Brands Inc. [TWNK] Institutonal Ownership Details
The top three institutional holders of TWNK stocks are: VANGUARD GROUP INC with ownership of 1.31 billion shares, which is approximately 8.2089%. BLACKROCK INC., holding 1.04 billion shares of the stock with an approximate value of $170.67 trillion in TWNK stocks shares; and BERKSHIRE HATHAWAY INC, currently with $150.98 trillion in TWNK stock with ownership which is approximately 5.7381%.
