Monday, October 25, 2010

Valu(e) Stocks

Pretty much the stock in my portfolio that I always forget, popped about 19% today. They traded almost 139k shares today vs an average of 9k daily. The news? They are paying a special $2 dividend (Value Line share surge with special dividend). Yeah I know. Why would a stock pop 20% just because they're paying a special dividend? I'll tell you. I don't know. I will admit that I was muy tempted to sell on the news. But they are still pretty darned cheap.

The other interesting news on the day was right on cue after my discussion of LBOs. CTV (not an MFI stock) announced they were going to be taken private (Carlyle in Talks to Purchase CommScope: Could InterDigital Have Been a Better Choice?). I found the question intriguing. IDCC seems like a natural choice to go private to me.

Also PPD said they would consider Private Equity stepping in (Pre-Paid Legal Services considers buyout offer). I can not imagine anything more bullish for our universe of stocks, than private equity stepping in and buying a few. And in today's low interest rate environment, set to encourage people to buy houses, will likely prime private equity and leveraged buyouts.

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