B. Riley Financial, Inc. ( RILY ) shares are trading higher Monday after the company announced it has agreed to sell its appraisal and valuations unit, Great American, to Oaktree Capital Management in a deal valued at approximately $386 million.

The Details:

B. Riley will complete a pre-closing internal reorganization and contribute all of the interests in its Appraisal and Valuation Services, Retail, Wholesale & Industrial Solutions and Real Estate Advisory businesses to the newly established Great American Holdings, LLC (Great American NewCo). 

The deal is expected to close in the fourth quarter of 2024. Upon closing, B. Riley will receive total consideration consisting of approximately $203 million in cash, Class B Preferred Units of Great American NewCo with an initial aggregate liquidation preference of approximately $183 million and Class A Common Units of NewCo representing approximately 47% of the total outstanding common units.

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“I am pleased to be partnering with Oaktree given its stellar track record and reputation as one of the world’s leading asset managers. We believe Oaktree’s scale and expertise in alternative investments and their strength as a capital provider, combined with the Great American Group’s leading position as a provider of asset disposition, financial advisory and real estate advisory services, will prove complementary as we join forces to deliver financial products and services to better serve our clients," said Bryant Riley, Co-CEO of B. Riley. 

According to data from Benzinga Pro, B. Riley shares are climbing on heavy volume following the company's announcement, but remain below the stock’s 50-day moving average of $7.04.  

Should I Sell My RILY Stock?

Whether to sell or hold a stock largely depends on an investor's strategy and risk tolerance. Swing traders may sell an outperforming stock to lock in a capital gain, while long-term investors might ride out the turbulence in anticipation of further share price growth.

Similarly, traders willing to minimize losses may sell a stock that falls a certain percentage, while long-term investors may see this as an opportunity to buy more shares at a discounted price.

Shares of B. Riley Financial ( RILY ) have lost 89.41% year to date. This compares to the average annual return of -54.18%, meaning the stock has underperformed its historical averages. Investors can compare a stock's movement to its historical performance to gauge whether this is a normal movement or a potential trading opportunity.

Investors may also consider market dynamics. The Relative Strength Index can be used to indicate whether a stock is overbought or oversold. B. Riley Financial ( RILY ) stock currently has an RSI of 30.67, indicating neutral conditions.

For analysis tools, charting data and access to exclusive stock news, check out Benzinga PRO. Try it for free.

RILY Price Action: According to Benzinga Pro, B.Riley shares are up 22.1% at $5.36 at the time of publication Monday.

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Image: Pete Linforth from Pixabay