Analysts Say Dean Foods Looks Good, But Insiders Still Selling
After Dean Foods Company (NYSE:DF) announced a proposed IPO and spinoff, the company's credit ratings held firm, leading to higher stocks and suggesting the company will not be immediately affected by the announcement.
According to Fitch Ratings, the company's proposed initial public offering and tax-free spin-off of its subsidiary WhiteWave Foods led to a Positive outlook rating. The IPO, which called for 20 percent of WhiteWave, could occur as soon as the fourth quarter in 2012, but the spin-off isn't expected to take place any sooner than a 180-day lock-up period after the IPO is closed.
According to Bloomberg, the deal will allow Dean, the largest U.S. dairy processor, to raise capital at low risk, as the S&P 500 is currently riding a three-month high.
"We are surprised by the timing of the proposed transaction as the standalone fresh dairy business will face higher milk price-related headwinds over the next several quarters," said Amit Sharma, a New York-based analyst for BMO Capital Markets.
In the last three months, company officials have sold $567,980 in shares through insider trades.
Do you think these insiders know something about the IPO the public doesn't?
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