CoreLogic shares get 29% boost on possible sale
CoreLogic Inc. (CLGX) shares soared 29% in Tuesday trading after the company, which provides data and services to the real estate and mortgage markets, said late Monday that it is exploring strategic options, including a possible merger or sale of the company. It was among the companies gaining the most ground in trading, closing at $11.35. The Dow was up just 0.18% on the day, closing at 11,559.95. The S&P 500 and the NASDAQ also gained less than 1% on the day. CoreLogic's board of directors formed a committee of independent directors to explore a range of options aimed at enhancing shareholder value including, but not limited to, cost savings initiatives, an evaluation of the firm’s capital structure, possible repurchases of debt and common stock, and the potential sale of the company. It hired Greenhill & Co. to pursue the possible actions. CoreLogic's stock took a beating when the company reporting its earnings on August 4. Although the company posted a profit, it missed analysts’ estimates. It reported net income of $31.5 million in the second quarter, up from $24 million one year ago. Last month, three analysts listed CoreLogic as a "strong buy," but none are this month. Six recommend a "hold" on the stock, up from three a month ago, according to analysts polled by Thomson/First Call. CoreLogic was spun off from title insurer First American Financial Corp. (FAF) in 2010. Competitors include Lender Processing Services (LPS), which was up 6% on the day, closing at $17.71 as well as Equifax Inc. (EFX), closing at $32.04, up less than 1%. Bloomberg reported Tuesday that CoreLogic options trading jumped to the highest level in more than a year Monday before the company said it may put itself up for sale. More than 1,200 calls to buy the stock changed hands on Monday, 10 times the four-week average, compared with no trades for puts to sell, Bloomberg reported. The surge in options trading happened before U.S. exchanges closed Monday. The company reported its plans to study strategic options immediately after the close. "It’s very suspicious," Ophir Gottlieb, managing director of client services at Livevol Inc., a San Francisco-based provider of options market analytics, said during an interview with Bloomberg. "It seems like someone caught wind of the news before the close and just went for it." Write to Kerry Curry. Follow Twitter @communicatorKLC.