When was the last time you kept a retailer buyout rumor on a watch list?  Or two retailers for that matter?  Friday’s trading was mixed with two buyout rumors in the retail segment.  GameStop Corp. (NYSE: GME) and SuperValu Inc. (NYSE: SVU).  The issue at hand is if private equity is back to making deals.  In these two particular cases, one buyout may make sense but one seems rather hard to fathom.

SuperValu Inc. (NYSE: SVU) almost put in a new 52-week high.  This seems hard to fathom on the surface considering the new normal, but everything we have seen points to a resumption of private equity.  SuperValu’s new CEO is on the job less than a year and is supposed to be winning with cost cuts and managing inventories and products.  Its $3.6 billion market cap does not send up a red flag for any deal limits even in the new normal now that the markets have recovered so well.

The grocery chain owner hit a Friday high of $17.89 but closed up 6.6% at $17.13 versus a prior 52-week high of $17.93.  Still, this was a $30 stock in 2008 and more than $40 in 2007.  There is no growth expected here, but the stock trades at only about 8.8-times Thomson Reuters estimates for its fiscal Jan-2010 and Jan-2011 estimates.  Even though the analysts who follow the stock have an average price target of under $15.00, this trades at a significant discount to peers.  Kroger is more than 12-times forward earnings versus Safeway’s multiple of more than 13-times forward earnings.