M&A

  • 27 Jan
    What See’s Candy & WhatsApp Can Teach Us About Creating Shareholder Value

    What See’s Candy & WhatsApp Can Teach Us About Creating Shareholder Value

    • Stock option compensation rewards management if the market does well, business performance is almost irrelevant.
    • BlackRock and Vanguard are becoming more assertive in the implementation of better governance policies. However, it seems it’s only a rhetoric given that they own 9% of corporate America.
    • Two examples show how CEOs can have opposing attitudes toward shareholder value.

    Introduction

    Today, we’ll dig deeper into corporate governance as it’s essential for our long-term investment returns.

    We’ve already discussed how buybacks mostly negatively affect long term shareholder value. But apart from buybacks, there are other interesting, more subtle issues that can help us lower our risks and increase returns.

    We’ll analyze what Larry Fink and William McNabb have to say about corporate governance, and we’ll look at a few examples of how CEOs manage their companies in order to show examples of good and bad practices. More →

  • 15 Dec
    This Could Push The S&P Even Higher

    This Could Push The S&P Even Higher

    • The market looks overvalued but there are three main factors that could push it even higher.
    • A repatriation tax holiday could make $2.1 trillion available for dividends, buybacks, and M&As.
    • Economic growth and inflation could push earnings higher, further inflating stock prices.

    Introduction

    It seems that everyone agrees on the fact that this market is overvalued and borderline irrational. However, there is no correction in sight and the only question to be asked is “how high can this market go?”

    The S&P 500 has jumped 5.4% since Trump won the elections, and is 12.1% higher year-to-date. By adding in the 2% dividend yield, we arrive at an excellent 14% return for 2016. This year’s positive return will make it number eight in a row for the S&P 500 as it has been rewarding investors since 2009. More →

  • 01 Dec
    The Chinese Are On A Buying Binge. Will Your Portfolio Benefit?

    The Chinese Are On A Buying Binge. Will Your Portfolio Benefit?

    • Positive long term outlooks, sharp technologies, interesting metals, and strong brands are what the Chinese are looking for.
    • The boom in Chinese acquisitions isn’t expected to stop as economic growth and development continues.
    • The Syngenta AG acquisition offer was made at a valuation over 30.

    Introduction

    We all know China has been growing rapidly in the last 30 years. What many don’t know is that through this growth, China has become the second largest global economy and is expected to become the largest global economy by 2030. More →

  • 28 Oct
    Is Merger Arbitrage A Good Bet For The AT&T – Time Warner Deal?

    Is Merger Arbitrage A Good Bet For The AT&T – Time Warner Deal?

    • With merger arbitrage, the biggest risk is always that the deal may not go through.
    • The market is currently giving the AT&T – Time Warner deal a 40% chance of success.
    • We’ll share some merger arbitrage insights from Warren Buffett.

    Introduction

    The announcement of the AT&T (NYSE: T) acquisition of Time Warner (NYSE: TWX) in an $85 billion cash and stock deal, was the big topic on the market this week.

    This and other merger and acquisition deals offer the opportunity to make a buck on merger arbitrage. We’ll explain how merger arbitrage is done, what can be gained from it, and what the risks are. More →

  • 10 Aug
    Mergers & Acquisitions – Better To Be Invested On The Target’s Side

    Mergers & Acquisitions – Better To Be Invested On The Target’s Side

    • M&A activity has slowed down in 2016 but may increase as BREXIT, China worries cool off and central banks print money.
    • Price to EBITDA premiums have surpassed 2007 levels.
    • The average premium for targets is 37%, which is a pretty good additional return on your investments.

    Introduction

    A beautiful situation in investing is when a company you own is being taken over at a lofty premium. In this article we are going to discuss the current M&A market, what it means for the market in general, and take a look into the sectors that offer the best consolidation opportunities. More →

    By Sven Carlin Investiv Daily M&A