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Fly News Breaks for October 8, 2018
DOOR, JELD
Oct 8, 2018 | 06:44 EDT
Jeld-Wen (JELD) over the weekend announced several recent rulings by the U.S. District Court for the Eastern District of Virginia, Richmond Division, in relation to its ongoing antitrust and trade secrets litigation with Steves & Sons, which most importantly, include that the divestiture of its Towanda, PA doorskin facility is an appropriate remedy in the antitrust litigation, JPMorgan analyst Michael Rehaut tells investors in a research note. The analyst says that while any negative ruling later this year regarding a divestiture would trigger an appeals process that could last 15-36 months, a potential required sale of the Towanda facility to an independent third-party buyer could result in a more competitive backdrop for the door industry, and in turn could negatively impact both Jeld-Wen's and Masonite's (DOOR) margins. The analyst, however, does not view a more competitive backdrop as a foregone conclusion in the event of a required divestiture, given "still positive industry demand, a pricing environment that has been stable and constructive for several years." He keeps a Neutral rating on Jeld-Wen shares.