Shares of Safeway Inc. rose Tuesday after Chief Executive Steve Burd said he might sell or "monetize" part of its Blackhawk Network gift-card unit because it was undervalued.
Burd also reiterated the company's 2008 forecast.
Shares of Pleasanton, Calif.-based Safeway climbed $1.25, or 4.4%, to $29.70, the biggest gain since Jan. 16.
The shares are down 13% this year.
"It was a more confident sales pitch compared to the fourth-quarter earnings call and bullish comments on Blackhawk," said Neil Currie, an analyst at UBS Securities.
Blackhawk sells gift cards from retailers including Nordstrom Inc. and Starbucks Corp. at more than 63,000 kiosks in Safeway and other grocery stores. Burd discussed selling the unit at a Bear Stearns Cos. conference in New York.