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Revlon shares jump 75% amid news of a potential buyout 

Revlon shares jump 75% amid news of a potential buyout
Dino Kurbegovic

Recent decades have not been kind to Revlon (NYSE: REV), which has dominated the cosmetics and beauty markets for much of its 90 years. More recently, the company struggled under great debt, competition from novel cosmetic companies, and now supply chain issues. 

Revlon bought Elizabeth Arden in 2016, which represented an $870 million attempt to fend off competition. It houses brands including Britney Spears and Christina Aguilera fragrances.

In the end, the company filed for bankruptcy on June 16, with the firm stock plummeting from $4 to the lows of $1. However, the stock is now surging in pre-market trading, up as much as 75% at the time of publication, after stories of a potential buyout from India’s conglomerate Reliance emerged.

Revlon shares pre-market movement. Source: Nasdaq

Revlon will be added to Reliance’s private label cosmetic brand Glimmer if the acquisition takes place. 

REV chart and analysis 

In short, the decline of REV shares began in November 2021, when the shares started a downward momentum dipping from $16 to $1, with the news of the bankruptcy filing. With the pre-market jump, the shares are back above all daily Simple Moving Averages (SMAs) on huge buying volumes. 

REV 20-50-200 SMA lines chart. Source. data. See more stocks here.

Accordingly, only one analyst is covering the stock, rating them hold and seeing a potential next 12 months price of $8.5, which is 322.89% higher than the last quoted price of $2.01.

Wall Street REV analysts’ price targets for REV. Source: TipRanks

It seems as if the shareholders of Revlon might be given a liferaft after the news that the company has filed bankruptcy.

Whether the acquisition actually happens is still unknown, with possible details of a deal yet to come out. For now, shareholders get to enjoy the over 70% jump in the stock pre-market. 

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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk. 

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