Friday, May 3, 2013

5 takeover rumors hedge funds are betting on




From Marketwatch: Publicly traded companies are often acquired at a large premium to their market price pre-announcement, and so rumored takeovers—whether or not they turn out to be true—can cause speculators to pile into the stock. These stocks aren't necessarily good buys, but certainly investors considering buying (or shorting) them should be aware of the potential for a takeover. Here are five stocks which have been the subject of recent takeover rumors:

Billionaire activist Carl Icahn has taken a large stake in Netflix NFLX +0.05%  and there has been some speculation that he might push to sell the company. He owned 5.5 million shares as of the beginning of this year (find Icahn's favorite stocks). Other analysts have claimed that Netflix could be a target purchase for a large technology company such as Microsoft to help win the "living room wars" between different consumer devices. Netflix's stock price has been very volatile over the past few years, and is quite expensive at present with a forward earnings multiple of 69.

There is a good deal of resistance to the idea, but analysts continue to suggest that CBS CBS +0.84%  might merge with Time Warner TWX +1.27%  …..




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