It has been nearly a month since Cabela’s (CAB) shareholders voted to approve a merger with Bass Pro Shops, but the company’s future remains as murky as ever. CAB‘s Q2 earnings report revealed a 9.3% decrease in revenue from the same time last year and a big EPS miss (reported $.41/share; analysts expected $.60/share). The outdoor recreation retailer had agreed to a buyout worth approximately $61.50 per share, but after recent bad news, Bass Pro Shops could be looking for a way out of the $4.2 billion deal, and may just have it. If Cabela’s fails to gain Federal Reserve approval to sell its credit card business to Synovus Financial prior to October 3rd, then Bass Pro Shops can walk from the deal without penalty.
Howie Long-Short: Add Cabela’s to the list of companies hurt by weak gun sales. Amazing how much politics drives this.
Fan Marino: My uncle is a hunter. 21 years. 1 deer. True Story.