What happened

Dean Foods (OTC:DF) is looking none too fresh this morning, with shares of the maker of Dean's milk and TruMoo (among many other brands) down 8.5% as of 1:05 p.m. EST.

The reason: Last week, in the course of announcing earnings, Dean Foods CEO Ralph Scozzafava announced that his company will be reviewing "a range of potential strategic alternatives to enhance shareholder value."

Check out the latest earnings call transcript for Dean Foods.

Ripped and spilled milk carton

Dean Foods stock looks like kind of a mess today. Image source: Getty Images.

So what

"Strategic alternatives," of course, is often corporate code-speak for "selling the company." And investors who've watched Dean Foods stock lose more than half of its value over the past 12 months probably wish they had sold the company a long time ago.

But the next best thing to getting out before the bad news struck is the hope that management will bail them out by selling the company to an acquirer, ideally at a premium big enough to at least significantly win back some of the losses investors have already incurred.

Now what

Now here's the thing: It might not happen.

In making his announcement last week, Scozzafava cautioned that "There can be no assurance that this review will result in any agreement or transaction and we do not intend to discuss or disclose developments with respect to the Board's process unless and until we determine the specific course of action or it's otherwise necessary." So, not only might Dean Foods not decide to sell the company -- it might not succeed even if it does try to sell.

This morning, analysts at Stifel rose to point this out, warning that "We do not believe there is a single strategic buyer for the company as it is constituted today."

Meanwhile over at Bernstein, analysts pointed out that, even if Dean decides to sell, and even if it succeeds in selling, the sales price not be what investors are hoping for. As quoted on Marketwatch today: "At present, comparing the book value of all assets and netting off the value of all liabilities yields a book value of $3.44 per share ... If we exclude the goodwill and intangibles that are currently on the balance sheet, we end up with a value of only [about] $1.25 per share."

Given that Dean stock sells for $3.60 right now, it's no wonder investors are bailing out over this milk-curdling math.

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