NEW YORK (TheStreet) -- Shares of Tim Hortons Inc. (THI) are spiking, up 15.17% to $73 in pre-market trading this morning as Canada's biggest seller of coffee and doughnuts plans a merger with Burger King Worldwide (BKW) , Bloomberg reported.
The Deal's Jonathan Marino and Sarah Pringle take a closer look at what the proposed merger would mean for Tim Horton and Burger King:
The tax inversion deal would move Burger King's base to Canada, Bloomberg noted.
Canada's corporate tax rate is 26.5% compared to 40% in the U.S., according to accounting firm KPMG.
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Separately, TheStreet Ratings team rates TIM HORTONS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate TIM HORTONS INC (THI) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, reasonable valuation levels, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."