The board is reviewing various alternatives including a sale of the company. Analyst Tony Wible says the sale makes sense given its large cash position and the stock's limited float. He believes National Processing's cash position historically has been discounted since National City owns about 85% of National Processing. In his view, Total System Services (or its parent Synovus Financia) would be the most likely buyer.
Overall, he thinks the sale would unlock the true value behind the name. Based on the prospects of the sale, he raised the $27 target price to $33, or to the middle of his $31 to $35 estimated takeout price range. He notes the target assumes National Processing will trade at a discount to the peer group, while it receives credit for its $5.54 cash per share.