The Children’s Place (NASDAQ:PLCE), a specialty retailer of children’s apparel and accessories, rose in trading after announcing that it had received the second tranche of an interest-free, unsecured, and subordinated term loan funding of $48.6 million from its majority shareholder, Mithaq Capital. The company had received $30 million in February.
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Following this second tranche of funding, the resignations of five directors have become effective, and the Board has been reduced to six members. Former Wells Fargo EVP and Interim General Counsel Douglas Edwards will join the company’s Board as an independent director. The company aims to secure a $130 million term loan this month and is seeking better terms with lender Gordon Brothers. It is also looking at alternative financing options.
PLCE was on shaky ground after the company flagged liquidity concerns. As of February 3, the specialty retailer had a total liquidity of around $45 million. This includes $13 million of cash and equivalents and around $32 million under its credit facility.
What Is the Price Target for Children’s Place?
Analysts remain bearish about PLCE stock with a Moderate Sell consensus rating based on two Holds and one Sell. PLCE stock has crashed by more than 50% over the past year, and the average PLCE price target of $18 implies an upside potential of 8.2% at current levels.
