Thursday January 14 2:25 PM ET
Sunglass Hut Stock Jumps After Internet Site Deals
CORAL GABLES, Fla. (Reuters) - Shares of Sunglass Hut International Inc. (Nasdaq:RAYS - news), the world's largest specialty retailer of sunglasses, rose as much as 56 percent on Thursday after the company said it acquired two Internet sites and Morgan Stanley Dean Witter raised its rating on the stock.
Sunglass Hut was trading at $9.19 early Thursday afternoon on the Nasdaq, or $1.81 higher than at Wednesday's close. It reached as high as $11.50 earlier in Thursday's session.
Late Wednesday, Sunglass Hut said it had acquired shades.com, one of the largest Internet sites devoted to the sale of branded non-prescription sunglasses, and SwissArmyDepot.com, which primarily sells SwissArmy knives and watches.
The sites together attract about 7,000 visitors per day, and in 1998, their Internet sales increased more than 170 percent compared to 1997.
The purchase price for the acquisition was about $2.8 million in cash and a convertible subordinated note in the amount of $1.2 million.
''We continue to explore the possible development and acquisition of other sites, including sites tied to our Watch Station retail format and our private-label sunglass products, to expand our market penetration in what we view as an increasingly important distribution channel, the company said in a statement.
Early Thursday, Morgan Stanley said it raised its rating on shares of Sunglass Hut to a strong buy from neutral. No further details were available.
Sunglass Hut operates 1,983 sunglass specialty locations and 119 Watch Station stores throughout the United States, Canada, the Caribbean, Europe, Australia, New Zealand and Singapore. |
