NEW YORK—After JPMorgan Chase & Co. agreed to buy Bear Stearns Cos. for $2 per share, analysts expressed "shock" at the sudden downturn in Bear Stearns' fortunes and pondered the impact of the buyout on the financial sector.
Following are some comments from analysts on the deal:
"One reaction is shock that a company that reaffirmed its book value at around $84 on Wednesday can be worth $2 per share four days later on Sunday."
- Deutsche Bank analyst Mike Mayo
"While we believe Bear Stearns' case is unique, what will not be unique, in our view, is a resulting major negative revaluation of financials."
- Oppenheimer analyst Meredith Whitney
"Although Bear Stearns shareholders are likely to be disappointed at the price it received, we believe their options were limited."
- Goldman Sachs analyst William Tanona
"Even with an estimated $6 billion of transaction costs, the deal economics look very compelling and from a strategic perspective JPMorgan is getting several business lines from Bear that are very complementary to its Investment Bank."
- Citi Investment Research analyst Keith Horowitz
