NEW YORK (TheStreet) -- Chico's (CHS) stock is gaining Tuesday on reports the company is exploring a potential sale to private equity firms. According to Financial Times, the retailer has in talks with "several private equity groups," citing sources familiar with the situation. However, any discussions are currently in the preliminary stages.
In morning trading, shares are up 10.3% to $16.96.
The retailer's stock prices have recently been hit by softer-than-expected sales amid a challenging retail environment. Year to date, shares are down 10.1%.
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TheStreet Ratings team rates CHICOS FAS INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHICOS FAS INC (CHS) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity."