Merger Arbitrage + Quarters
Chart - GTLS - $200 - got an offer from Baker Hughes. This is s confusing situation. I am a holder for right now, but I am looking for an exit point. Looks like a good deal for BH. Another bidder could show up, but the company does not seem to be fighting.
Given the difficult regulatory environment, one buyout a year is ok. (We had Ruth’s
Hospitality in 2023)
Let’ wait for some quarters before picking a new stock.
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We are half way through earnings season. Results are mixed, which is above average for a value investor.
Still confusing signals on the economy, bur good to see boat buying was ok.
Let’s pat ourselves on the back for avoiding Dow and Whirlpool, they both cut their dividend. This is tax loss selling season, so let’s not rush in.
LKQ had a bad miss, tariffs are an issue, but this is a neat business.
Here are the upcoming quarters:
Kinder Morgan - 7/16 - in line, but hints of bigger projects to come
Pepsi - 7/17 - beat by $.09, international very strong, still Kennedy concerns
Sysco 7/20 - in line, but guidance for fiscal 2026 was perceived as light, but 5-7% is OK for me, still some weakness in non-chain restaurants, salesforce turnover has ended, still a strong, but boring, story
Steel Dynamics 7/21 - a few pennies weak, poured first aluminum ingot, this is an exciting story, steel mills still at only 80% of capacity.
Alexandria 7/21 - in line, decent results, but still lots of confusion in health care, making asset sales, holds guidance, but no buybacks this quarter
Halliburton 7/21 - in line, boring is ok
Matador 7/22 - missed, still big buyback talk, and potential spinout of pipeline business
Iridium 7/24 - strange negative reaction to small cut in revenue growth rate, EBITDA will be unchanged, story intact, making buybacks
Brunswick - solid results, bouncing along the bottom, inventories in good shape
Gentex - beats by $.08, stock jumped 30% on very little news, strange
Teck 7/24 - cut production forecast for 2025, but expects 2026 unchanged, lots of cash, should have waited for bad news, Hudbay doing better
Darling 7/24 - very confusing regulatory issues, base business solid, California to be resolved in a few weeks
Red Rock 7/29 - “blowout quarter”, could not be better, stock should be up more
Sinclair 7/31 pre
Chart 7/31 - agreed to be acquired
Middleby 8/1 pre
Tyson 8/4 pre
Rayonier 8/6 post
Nutrien 8/6 post
Royal Gold 8/6 post
Corteva 8/6 post
RXO - 8/7 pre
Nexstar 8/7 during
Restaurant Brands 8/7 post
Thor 9/25 pre
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ideas:
WillScot 7/31 post
Norwegian 7/31 pre
Starbulk 8/6 post
Merck 7/29 pre
Perrigo 8/6 during
Scotts 7/30 pre
Mohawk 7/24 post
Starwood 8/7 pre
Lyondell 8/1 pre
Portillo’s 8/5 pre
First Watch 8/5 pre
Columbia 7/31 post
Entegris 7/30 pre
Constellation 10/3, reported 7/1
Certera 8/6 post