Willbros Group sold for $100M

Primoris to acquire Willbros Group in all-cash transaction

 

Primoris to acquire Willbros Group, Stockwinners.com
Primoris to acquire Willbros Group,

Primoris Services Corporation (PRIM) announced that it has entered into a definitive merger agreement to acquire Willbros Group (WG) in an all-cash transaction.

Primoris will pay 60c per share for all of the outstanding stock of Willbros and will settle all of the existing Willbros debt obligations, for an enterprise value of approximately $100M.

Willbros is a specialty energy infrastructure contractor serving the Oil & Gas and Power industries across its three operating segments: Utility Transmission and Distribution, Oil & Gas, and Canada. Willbros’ infrastructure services platform provides a diverse base of utility, natural gas, and renewable customers with comprehensive engineering, construction, maintenance, repair, and restoration solutions.

Upon completion of the transaction, Primoris expects the Willbros UTD business to become a new operating segment, Primoris UTD, which continues Primoris’ strategic plan for growing its Master Service Agreement revenue base.

Primoris anticipates that Willbros’ Lineal Oil & Gas operations will be incorporated into Primoris’ Utilities & Distribution segment, the Houston-based Oil & Gas facilities operations will become part of Primoris’ Pipeline & Underground segment, and the Canadian business will become part of Primoris’ Power, Industrial, and Engineering segment.

Primoris expects the financial benefits of the transaction to include: For the first 12 months after closing, revenues of approximately $660M, including estimated UTD revenues of $470M, For the first 12 months after closing, EBITDA of $25M, including approximately $7M in annual cost savings, The addition of approximately $400M to Total Backlog, including approximately $300M from the UTD business and within 24-30 months after the closing of the transaction, additional annual cost savings of $7.5 million to $10M.

Under the terms of the merger agreement, which was unanimously approved by the Boards of Directors of both Willbros and Primoris, each stockholder of Willbros will receive 60c per share in cash, without interest, which represents a significant premium to the closing price of Willbros common stock on March 27, 2018.

In addition, Primoris will settle all of the existing Willbros debt obligations. The transaction has an enterprise value of approximately $100M.

Primoris intends to finance the transaction through cash on hand and its existing credit facilities.

As part of the transaction, Primoris has agreed to provide Willbros up to $20M in secured bridge financing to support Willbros’ working capital liquidity needs prior to the transaction close.

The transaction is subject to approval by Willbros stockholders and certain other closing conditions. In connection with the execution of the merger agreement, certain Willbros directors and stockholders, together representing approximately 17% of Willbros’ outstanding shares, have entered into voting agreements with Primoris, whereby such stockholders agreed, among other things, to vote in favor of the adoption of the merger agreement. The transaction is expected to be completed in the second quarter of 2018.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Gebr. Knauf offers to acquire USG for $42 per share

Gebr. Knauf offers to acquire USG for $42 per share

 Gebr. Knauf offers to acquire USG for $42 per share. Stockwinners.com
Gebr. Knauf offers to acquire USG for $42 per share.

In a regulatory filing, Berkshire Hathaway (BRK.A) disclosed that from time to time, beginning many years ago, executives of Gebr. Knauf Verwaltungsgesellschaft KG, or “Gebr. Knauf,” have contacted Berkshire’s Chief Executive Officer to describe the Knauf Entities’ potential and conditional interest in a transaction with USG.

Most recently, the Knauf Entities furnished Berkshire a copy of a letter from Gebr. Knauf to USG dated March 15, 2018 in which Gebr. Knauf submitted an indicative and non-binding proposal for the acquisition of 100% of the outstanding shares of Common Stock of USG at $42.00 per share.

“On March 23, 2018 Berkshire’s CEO and another Berkshire executive held a telephonic discussion with two executives of the Knauf Entities and three representatives of one of the advisors of the Knauf Entities, during which Berkshire proposed to grant to the Knauf Entities an option to purchase all of the Berkshire Entities’ shares of Common Stock of USG, subject to legal review.

Such option would be exercisable only in connection with the consummation of a purchase by the Knauf Entities of all of the outstanding shares of Common Stock of USG that the Knauf Entities did not already own, at a price of not less than $42.00 per share, subject to and in accordance with applicable law and contractual restrictions.

The option exercise price per share was proposed by Berkshire to be the price per share paid to such other holders of Common Stock of USG by the Knauf Entities, less the option purchase price of $2.00 per share to be paid to the Berkshire Entities upon entering into a definitive option agreement.

The option would have a term of approximately 6 months.

The Knauf Entities have not responded to this proposal, and the Reporting Persons do not know whether the Knauf Entities will pursue further discussion with Berkshire of the proposed option or will make an offer to purchase shares of Common Stock of USG.

Berkshire has not agreed to support any plan or proposal by the Knauf Entities with respect to the Common Stock of USG, and there are no agreements, written or otherwise, between the Reporting Persons and the Knauf Entities.”

USG closed at $33.51.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

TPG Pace Energy to acquire oil and gas assets from EnerVest fo $2.66B

TPG Pace Energy to acquire oil and gas assets from EnerVest fo $2.66B

TPG Pace Energy to acquire oil and gas assets from EnerVest fo $2.66B. Stockwinners.com
TPG Pace Energy to acquire oil and gas assets from EnerVest fo $2.66B

TPG Pace Energy (TPGE) announced it has entered into definitive agreements with certain funds managed by EnerVest to acquire the oil and gas assets within EnerVest’s South Texas Division for approximately $2.66B in cash and stock.

As part of the transaction, TPGE and EnerVest are partnering to create Magnolia Oil & Gas Corporation, a new company led by Steve Chazen who will serve as Magnolia’s full-time chairman, president and CEO.

EnerVest will retain a significant ownership stake in Magnolia.

The transaction is subject to approval by the TPGE shareholders and other customary closing conditions, and the new company will trade on the NYSE under a new ticker upon closing, which is expected to occur late in the second quarter of 2018.

The formation of Magnolia creates a large-scale, pure-play South Texas operator with top-tier Eagle Ford and Austin Chalk asset positions with more than 40,000 boe per day of production.

Magnolia will acquire EnerVest’s approximately 360,000 total net acres in South Texas, which consists of approximately 14,000 net acres in one of the most prolific sections of Karnes County and 345,000 net acres in the emerging, high-growth potential Giddings Field.

The acreage position is almost entirely held by production, and the production from the combined asset base is heavily weighted toward oil.

TPGE closed at $9.73.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Clorox to acquire Nutranext for $700M

Clorox agrees to acquire Nutranext

Clorox agrees to acquire Nutranext. Stockwinners.com
Clorox agrees to acquire Nutranext. 

Clorox (CLX) announced that it has entered into a definitive agreement to acquire Nutranext, a health and wellness company based in Sunrise, Florida, which manufactures and markets leading dietary supplement brands in the retail and e-commerce channels as well as in its direct-to-consumer business.

The Nutranext acquisition brings significant scale and breadth to Clorox’s dietary supplements business.

It follows the company’s May 2016 acquisition of the RenewLife brand, a leader in digestive health. Clorox’s brand-building capabilities and retail execution behind the RenewLife brand have led to strong growth in the e-commerce channel and expanded distribution in the retail channel. In calendar year 2017, Nutranext generated sales of about $200M.

Clorox will pay $700M to acquire Nutranext, with the purchase price representing about 3.5 times calendar year 2017 sales.

The company expects to fund the transaction through a combination of available cash and debt financing, while maintaining a Debt/EBITDA ratio within its target range of 2.0x to 2.5x.

The transaction is subject to certain closing conditions, including customary regulatory approvals, and is expected to close in the company’s fiscal fourth quarter, which ends June 30, 2018.

Clorox’s preliminary estimates indicate the acquisition will dilute earnings per share by 7-11c in the fourth quarter of its current fiscal year, ending June 30, 2018, and by 8c-12c in fiscal year 2019 and be accretive to earnings per share in fiscal year 2020.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

House Republicans sign letter expressing ‘deep concern’ over Trump tariffs

House Republicans sign letter expressing ‘deep concern’ over Trump tariffs

divided-gop over Trump tariff, Stockwinners
GOP divided over Trump tariffs,

Over 100 House Republicans have signed a letter to the White House expressing “deep concern” over potential tariffs on aluminum and steel imports.

divided-gop over Trump tariff, Stockwinners
GOP divided over Trump tariffs,

Representative Kevin Brady, a Republican from Texas and chairman of the House Ways and Means Committee, wrote in the letter that, while the GOP lawmakers “support” President Trump’s “resolve to address distortions caused by China’s unfair practices,” they urge him to “reconsider the idea of broad tariffs to avoid unintended negative consequences to the U.S. economy and its workers.”

The letter says that “key elements” are required to minimize any negative consequences associated with the proposed tariffs, namely that any relief should be “narrow” and that a robust exclusion process should be announced at the outset that allows U.S. companies to petition for and promptly obtain duty-free access for imports that are unavailable from U.S. sources or otherwise present extenuating circumstances.

In addition, the lawmakers believe that existing contracts to purchase aluminum or steel should be “grandfathered to allow duty-free imports and avoid disrupting the operations and finances of projects that are already budgeted and underway.”

Lastly, the letter says that the effects of this remedy on the U.S. economy should be “reviewed and reconsidered” on a short-term basis to determine if another approach would be better. Publicly traded metal producers include U.S. Steel (X), Century Aluminum (CENX), Alcoa (AA), and AK Steel (AKS).


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Aegean Marine to acquire H.E.C. Europe for $367M

Aegean Marine to acquire H.E.C. Europe for approximately $367M

Aegean Marine to acquire H.E.C. Europe for $367M. Stockwinners.com
Aegean Marine to acquire H.E.C. Europe for $367M.

Aegean Marine (ANW) is pleased to announce that today it has entered into a definitive agreement to acquire all of the outstanding share capital of H.E.C. Europe Limited, the parent company of Hellenic Environmental Center S.A. and a group of companies that together provide global port reception facilities services, from the shareholders of H.E.C., for aggregate consideration of approximately $367M, including the assumption of certain indebtedness, which consideration is payable in the form of a combination of debt, the assignment of certain accounts receivables, cash and shares of Aegean common stock, which will represent approximately 33% of the issued and outstanding common stock of Aegean after giving effect to the issuance.

The Sellers are companies owned and controlled by Dimitris Melisanidis and certain members of his family, and members of the Agiostratitis family.

Aegean expects the acquisition, which results from several months of negotiations, to be immediately accretive to adjusted earnings per share in year one.

The acquisition was unanimously approved by the Aegean Board upon the recommendation of a special committee of independent directors. In making its recommendation, the Special Independent Committee consulted with its independent financial advisor, Clarksons Platou Securities and outside legal counsel.

The acquisition does not require the approval of Aegean’s shareholders. Aegean expects the acquisition to be immediately accretive to adjusted EPS in year one. Post-closing of the transaction, expected additional 2018E Revenues will amount to approximately $60M-$65M and 2018E EBITDA will amount to approximately $35M-$40M, which assumes timely closing of the transaction and completion of targeted acquisitions in 2018.

In addition, Aegean expects to appoint one additional independent director to the Aegean Board, effective as of the closing of the acquisition, creating an eight member Board of Directors.

ANW closed at $4.45.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Barron’s in bullish on Citi, bearish on GE

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin
Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH   MENTIONS: 

Hovnanian (HOV) stock too cheap to ignore- Hovnanian Enterprises offers an interesting speculative bet, because more than a decade’s worth of problems are reflected in the price, Brett Arends writes in this week’s edition of Barron’s. A successful resolution of its legal issues, a corporate turnaround, a takeover, or a continued recovery in the U.S. real estate market are all potential catalysts, he adds.

JPMorgan, Walmart cash flow yields exceed dividend yields – The cash flow yields of JPMorgan (JPM), Johnson & Johnson (JNJ), Walmart (WMT), Pfizer (PFE), Cisco (CSCO), AbbVie (ABBV), PepsiCo (PEP), 3M (MMM), Bristol-Myers (BMY), United Technologies (UTX), Texas Instruments (TXN) and Abbott Laboratories (ABT) exceed their dividend yields, a good signal for dividend coverage and growth, Lawrence Strauss writes in this week’s edition of Barron’s.

Alphabet, Citi well positioned for later stages of market rally – It is time for investors to think about how and when bull markets end, Jack Hough writes in this week’s edition of Barron’s. Groups to favor now include financials, which benefit from rising interest rates, and industrials, he notes, adding that technology still looks attractive. Alphabet (GOOG; GOOGL), Lam Research (LRCX), Citigroup (C), and Cummins (CMI) are all well positioned for the later stages of a long market rally, Hough contends.

Bears, bulls battle over Under Armour – In a follow-up story, Barron’s says that Under Armour (UA) reported fourth quarter revenue that beat Wall Street’s estimate, but is difficult to tell whether the revenue upside represents a turning point for the business. Bulls and bears both found something to support their arguments, as revenue increased but gross margin declined while inventories swelled and store count rose 22%, the report notes.

BEARISH  MENTION:

General Electric stock could drop another 10% – General Electric (GE) lost $6B in 2017 after a series of charges and impairments, cut its dividend by 50%, and its accounting is under investigation by the Securities and Exchange Commission, but lately it has been attracting fresh attention from value-oriented investors, Andrew Bary writes in this week’s edition of Barron’s. Nonetheless, the stock is not a bargain and could drop another 10% or more, he contends


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

A. Schulman sold for $2.25B

LyondellBasell to acquire A. Schulman for $2.25B

LyondellBasell to acquire A. Schulman for $2.25B. Stockwinners.com
LyondellBasell to acquire A. Schulman for $2.25B.

LyondellBasell (LYB) and A. Schulman (SHLM) announced that they have entered into a definitive agreement under which LyondellBasell will acquire A. Schulman for a total consideration of $2.25B.

The acquisition builds upon LyondellBasell’s existing platform in this space to create a premier Advanced Polymer Solutions business with broad geographic reach, leading technologies and a diverse product portfolio.

Under the terms of the agreement, LyondellBasell will acquire A. Schulman for a total consideration of $2.25B.

LyondellBasell will purchase 100% of A. Schulman common stock for $42 per share in cash and one contingent value right per share and assume outstanding debt and certain other obligations.

In addition, the contingent value rights generally will provide a holder with an opportunity to receive certain net proceeds, if any are recovered, from certain ongoing litigation and government investigations relating to A. Schulman’s Citadel and Lucent acquisitions. LyondellBasell is using cash-on-hand to finance the acquisition.

LyondellBasell expects to achieve $150M in run-rate cost synergies within two years, primarily by leveraging its well-established approach to cost discipline and productivity, as well as its culture of operational, business and commercial excellence.

Further, the acquisition is expected to be accretive to earnings within the first full year following close.

The combined businesses had revenues of $4.6B and adjusted EBITDA of $446M over the last 12 months.

The proposed acquisition, which has been unanimously approved by the respective boards of LyondellBasell and A. Schulman, is subject to customary closing conditions, including regulatory approvals and approval by A. Schulman shareholders.

The acquisition is expected to close in the second half of 2018.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Layne Christensen sold for $565M

Granite Construction to acquire Layne Christensen in $565M stock merger

Granite Construction to acquire Layne Christensen. Stockwinners.com
Granite Construction to acquire Layne Christensen 

Granite Construction Incorporated (GVA) and Layne Christensen Company (LAYN) announced that they have entered into a definitive agreement whereby Granite will acquire all of the outstanding shares of Layne in a stock-for-stock transaction valued at $565 million, including the assumption of net debt.

The transaction, which was unanimously approved by the Boards of Directors of both companies, is expected to close in the second quarter of 2018.

Granite Construction to acquire Layne Christensen. Stockwinners.com
Granite Construction to acquire Layne Christensen

Under the terms of the agreement, Layne shareholders will receive a fixed exchange ratio of 0.270 Granite shares for each share of Layne common stock they own. This represents $17.00 per Layne share, or a premium of 33%, based on the volume-weighted average prices for Granite and Layne shares over the past 90 trading days.

Following the close of the transaction, Layne shareholders will own approximately 12% of Granite shares on a fully diluted basis, and Granite’s Board will be expanded to include one additional director from Layne.

The transaction represents an enterprise value multiple of 8.2x 2018 expected EBITDA.

Granite expects to achieve approximately $20 million of annual run-rate cost savings by the third year following the close of the transaction, with approximately one-third realized in 2018.

Granite expects to incur approximately $11 million in one-time costs to achieve these savings.

The transaction is expected to be accretive to Granite’s adjusted earnings per share, and high single-digit accretive to Granite’s adjusted cash earnings per share in the first year after closing.

Granite expects to assume outstanding Layne convertible debt with principal value of $170 million and honor the terms and existing maturity date provisions of the indentures.

The transaction is not expected to trigger any change of control provisions under Layne’s indentures.

Granite also expects to fund the cash financing requirements of the transaction of approximately $70 million through a combination of existing cash on hand and availability under Granite’s revolving credit facility.

Following close, Granite will maintain an investment grade credit profile and significant financial flexibility.

The transaction, which is expected to close in the second quarter of 2018, is subject to the satisfaction of customary closing conditions, including applicable regulatory approvals and the approval of the shareholders of Layne.

Wynnefield Capital, which has an approximate 9% voting interest in Layne, has agreed to vote in favor of the transaction.

In connection with the transaction, Granite will issue approximately 5.4 million shares of Granite common stock to Layne common stockholders.

LAYN closed at $12.62. GVA closed at $60.08.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Changes to S&P MidCap 400, S&P SmallCap 600 indices

Changes to S&P MidCap 400, S&P SmallCap 600 indices

Stocks to buy, stocks to watch, upgrades, downgrades, earnings
Changes to S&P MidCap 400, S&P SmallCap 600 indices

S&P Dow Jones Indices will make the following changes to the S&P MidCap 400 and S&P SmallCap 600:

S&P SmallCap 600 constituent Boyd Gaming (BYD) will replace CalAtlantic Group (CAA) in the S&P MidCap 400, and Ring Energy (REI) will replace Boyd Gaming in the S&P SmallCap 600 effective prior to the open of trading on Tuesday, February 13.

S&P 500 constituent Lennar (LEN) is acquiring CalAtlantic Group in a deal expected to be completed on or about February 12 pending final approvals.

James River Group Holdings (JRVR) will replace Barracuda Networks (CUDA) in the S&P SmallCap 600 effective prior to the open of trading on Monday, February 12.

Thoma Bravo is acquiring Barracuda Networks in a deal expected to be completed on or about that date pending final conditions.

EVERTEC (EVTC) will replace Sucampo Pharmaceuticals (SCMP) in the S&P SmallCap 600 effective prior to the open of trading on Wednesday, February 14.

S&P 500 constituent Mallinckrodt (MNK) is acquiring Sucampo Pharmaceuticals in a deal expected to be completed on or about that date pending final conditions.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

8point3 Energy sold for $977 million

8point3 Energy to be acquired by Capital Dynamics for $977M in equity value 

8point3 Energy sold for $977 million. Stockwinners.com
8point3 Energy sold for $977 million 

8point3 Energy Partners (CAFD) announced it has entered into an Agreement and Plan of Merger and Purchase Agreement with CD Clean Energy and Infrastructure V JV, LLC, an investment fund managed by Capital Dynamics, Inc., and certain other co-investors – collectively, “Capital Dynamics” – pursuant to which Capital Dynamics will acquire 8point3 through an acquisition of 8point3 General Partner, LLC, the general partner of the Partnership, all of the outstanding Class A shares in the Partnership and all of the outstanding common and subordinated units and incentive distribution rights in 8point3 Operating Company, LLC, the Partnership’s operating company.

Pursuant to the Proposed Transactions, the Partnership’s Class A shareholders and First Solar, Inc. ( FSLR) and SunPower Corporation (SPWR), as holders of common and subordinated units in OpCo, will receive $12.35 per share or per unit in cash, plus a preset daily amount representing cash expected to be generated from December 1, 2017 through closing less any distributions received after the execution of the Merger Agreement and prior to closing.

No consideration will be received by the Sponsors for the incentive distribution rights and the GP Transfer.

CAFD closed at $13.83.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Midstates Petroleum proposes merger with SandRidge Energy

Midstates Petroleum proposes all-stock combination with SandRidge Energy

Midstates Petroleum calls for merger with SandRidge Energy. Stockwinners.com
Midstates Petroleum calls for merger with SandRidge Energy

Midstates Petroleum Company (MPO) announced that it has proposed to combine with SandRidge Energy (SD) in an all-stock merger that would create the leading exploration and production company in the Mississippian Lime play.

Earlier today, Midstates sent a letter to the Board of Directors of SandRidge detailing the merger proposal and its strong desire to negotiate a friendly transaction.

Given the highly complementary nature of the businesses, significant shareholder overlap, and the substantial operational synergies, Midstates believes that the proposed combination is attractive strategically and financially for the shareholders of both companies.

Under the terms of the proposal, SandRidge shareholders would own approximately 60% of the combined company and Midstates shareholders would own 40%.

David J. Sambrooks, Midstates President and Chief Executive Officer, stated, “We are ready to move forward immediately to negotiate a merger agreement to form a stronger, more formidable company.

The combined company will have zero net debt, strong liquidity, and forecasted free cash flow generation of up to $480 million over the next five years.”

Sambrooks continued, “Combining these two businesses in an at-market merger would bring undeniable benefits to shareholders of both companies.

The strategic fit and geographic overlap of both companies’ assets in the Miss Lime and NW STACK builds critical mass, creates significant synergies, and generates superior, risk-adjusted returns.”

Midstates is making this proposal public to inform both Midstates and SandRidge shareholders of the compelling value creation potential of the combination and to encourage SandRidge’s board to move towards a negotiated transaction.

MPO closed at $15.45. SD closed at $16.50.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Barron’s is bullish on Danaher and GM

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:  

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin
Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH   MENTIONS:

Danaher among more reliable stocks– Danaher’s (DHR) results were met with cries of sell even though they were stellar as ever, sending the shares into negative territory on Monday, Ben Levisohn writes in this week’s edition of Barron’s. Fast-forward to Friday, the stock market was in freefall but the stock weathered the blast, he notes, adding that there is something to be said for Danaher’s consistency. While it will never be the fastest grower, it has grown sales at 4%-5%, quarter after quarter, while cutting costs and improving efficiency to grow earnings, making it one of the more reliable stocks out there, the report says.

General Motors shares could rise more than 35% – General Motors (GM) has been turning in strong profits, which have helped it fund research into autonomous and electric cars, Jack Hough writes in this week’s edition of Barron’s. When Tesla’s (TSLA) stock-market value surpassed General Motors last year, it was big news, but recently the latter has edged back into the top spot, he adds. Selling at just seven times forward earnings, General Motors shares have room to rise more than 35% in the year ahead, Hough contends.

Cisco, Oracle among stocks with rising dividend estimates – Some of the large-cap companies whose dividend estimates for their current fiscal year have increased by at least 2% since July include Cisco (CSCO), Texas Instruments (TXN), UnitedHealth (UNH), Oracle (ORCL), Comcast (CMCSA), 3M (MMM), AbbVie (ABBV), Boeing (BA), Union Pacific (UNP), Bank of America (BAC), Citigroup (C), Wells Fargo (WFC) and JPMorgan (JPM), Lawrence Strauss writes in this week’s edition of Barron’s.

TD Ameritrade adding round-the-clock trading – TD Ameritrade  (AMTD) is offering customers more social media capabilities and has added round-the-clock trading in 12 exchange-traded funds, from Sunday evening through Friday evening using its thinkorswim trading platform or TD Ameritrade Mobile Trader app, Theresa Carey writes in this week’s edition of Barron’s.

Apple, Facebook facing challenges, shares still holding up well – Considering the challenges they face, both Apple (AAPL) and Facebook (FB) shares held up well, Tiernan Ray writes in this week’s edition of Barron’s. Apple offered a forecast for its March quarter that missed expectations, and Wall Street now thinks that the company is reaching a bit too far in pricing the iPhone X at $999-$1150, he notes. Nonetheless, Apple is still an empire very much in control of its destiny, Ray contends. Meanwhile, Facebook said people are spending less time than before on the site, but Mark Zuckerberg calmly assured the Street that he thinks it is a good thing, the report points out.

Cisco, Salesforce among most sustainable companies – Cisco (CSCO) tops Barron’s first annual list of most sustainable companies, followed by Salesforce (CRM), Best Buy (BBY), Intuit (INTU), HP Inc. (HPQ), Texas Instruments (TXN), Microsoft (MSFT), Oshkosh (OSK), Clorox (CLX) and Xylem (XYL).

Spirit Air offers plenty of potential upside – Following a steep decline, shares of Spirit Airlines (SAVE) now trade for less than 12 times forward earnings estimates, a good value or growth play, Brett Arends writes in this week’s edition of Barron’s. Long-term investors may need to be patient because short-term headwinds pop up so frequently for airline stocks, but in return for its risks, Spirit offers reasonable valuations and plenty of potential upside, he argues

BEARISH  MENTIONS:

Musk new compensation package sets wrong targets – Tesla’s  (TSLA) new 10-year compensation package, which considers that Elon Musk could grow the company’s market capitalization from the current $58B to $650B in 2028, is not shareholder-friendly as it emphasizes market cap goals, not sustainable profits, Vito Racanelli writes in this week’s edition of Barron’s.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

Ply Gem sold for $2.4B

Ply Gem to be acquired by Clayton, Dubilier & Rice in deal valued at $2.4B

Ply Gem to be acquired by Clayton, Dubilier & Rice in deal valued at $2.4B. Stockwinners.com
Ply Gem sold for $2.4B

Ply Gem Holdings (PGEM) and Clayton, Dubilier & Rice announced a definitive agreement under which CD&R funds will acquire all of the outstanding shares of Ply Gem common stock in a go-private transaction valued at approximately $2.4B.

Ply Gem’s board of directors unanimously approved the agreement, which provides for the payment of $21.64 per share in cash to all holders of Ply Gem common stock.

The cash purchase price represents a premium of approximately 20% over Ply Gem’s closing stock price on January 30, 2018.

Promptly following entry into the agreement, stockholders holding greater than 50% of the outstanding shares of Ply Gem common stock executed a written consent to approve the transaction, thereby providing the required stockholder approval.

CD&R has also entered into a definitive agreement to acquire Atrium Windows & Doors and combine the company with Ply Gem to create an exterior building products company with total revenue of more than $2.4B in 2017.

The transactions are expected to close simultaneously in the second quarter of 2018 and are subject to the receipt of customary closing conditions, including regulatory approvals.

Closing of the acquisition of Ply Gem is not subject to the closing of the acquisition of Atrium.

However, assuming both transactions close simultaneously, CD&R funds will own approximately 70% of the new privately-held company, and Atrium shareholders, which include funds managed by Golden Gate Capital, will hold approximately 30%.

The new Ply Gem will continue to be headquartered in Cary, NC, and Gary E. Robinette, currently Chairman and CEO of Ply Gem, will continue as Chairman and CEO. John Krenicki, a CD&R Operating Partner and former Vice Chairman of General Electric Company, will become Lead Director of the Board.

Ply Gem Holdings, Inc. manufactures and sells residential and commercial building products primarily in the United States and Canada.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

KapStone sold for $4.9 billion

WestRock to acquire KapStone for $35.00 per share

WestRock to acquire KapStone for $35.00 per share. Stockwinners.com
WestRock to acquire KapStone for $35.00 per share

WestRock (WRK) and KapStone Paper and Packaging (KS) announced the signing of a definitive agreement, pursuant to which WestRock will acquire all of the outstanding shares of KapStone for $35.00 per share and will assume approximately $1.36B in net debt, for a total enterprise value of approximately $4.9B.

Based on KapStone’s annualized EBITDA performance in the second half of its fiscal 2017, WestRock estimates the EV/EBITDA multiples to be under 10 times before and 7 times after the full run rate of expected cost synergies and performance improvements.

Upon closing, the acquisition is expected to be immediately accretive to WestRock’s adjusted earnings and cash flow, inclusive of purchase accounting adjustments.

KapStone stockholders will have the option to receive $35.00 per share in cash, or to elect to receive 0.4981 WestRock shares per KapStone share, with elections of stock consideration capped at 25% of the outstanding KapStone shares but no limit on the number of KapStone shares that can receive cash consideration.

KapStone’s chairman, Roger Stone, and president and chief executive officer, Matt Kaplan, have entered into voting agreements, pursuant to which they have agreed to vote their shares in support of the transaction, subject to certain limitations.

WestRock will finance the cash consideration through the issuance of new debt under a fully committed financing package. WestRock expects to refinance existing KapStone debt assumed as part of the transaction upon closing.

WestRock’s expected leverage ratio at the closing of the transaction will be greater than 3.00x, and WestRock expects to return to its stated leverage ratio target of 2.25x to 2.50x by the end of fiscal 2019.

The transaction is not conditional on financing. The transaction is subject to a number of customary closing conditions, including a vote by KapStone’s stockholders, and is expected to close during the quarter ending September 30, 2018.

Upon completion of the transaction, KapStone will be integrated into WestRock’s Corrugated Packaging segment.


STOCKWINNERS

To read timely stories similar to this, along with money making trade ideas, sign up for a membership to Stockwinners

This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.