What are you buying today?

[ValueMaven]

Has anyone looked at the JNJ-KVUE swap?  It's an interesting one.

You buy 99 shares of JNJ and swap it into KVUE at a meaningful discount.  It's about a 17% return in 2 weeks time.  

If you buy 100 shares you want be guaranteed a full swap, and if you buy 99 shares and don't allocate the full 99 shares, then you will lose out as well.  KVUE also has sold off and seems cheap to me given its business and moat.  Hedge Funds cant do this (99 share issue) and most retail is unaware of the transaction.  

[Castanza]

7 hours ago, ValueMaven said:

Has anyone looked at the JNJ-KVUE swap?  It's an interesting one.

You buy 99 shares of JNJ and swap it into KVUE at a meaningful discount.  It's about a 17% return in 2 weeks time.  

If you buy 100 shares you want be guaranteed a full swap, and if you buy 99 shares and don't allocate the full 99 shares, then you will lose out as well.  KVUE also has sold off and seems cheap to me given its business and moat.  Hedge Funds cant do this (99 share issue) and most retail is unaware of the transaction.  

Interesting situation

 

Another one I stumbled upon courtesy of Andrew Walker is the RideQ situation with Foxconn. Shares trading around $3ish and they filed for bankruptcy. Interesting aspect is they have no debt and a lot of cash on hand. To top it off they are suing Foxconn for basically pulling the rug out from under their business and causing permanent damages. Will be interesting. The kicker is there is a 3% cap on share ownership so a lot of the big guys can’t touch this. According to Andrew there is a lot of cash per share that could give quite. A bit of upside pending the suit. Haven’t checked any of the math here and I’m always hesitant of the suit working out, but either way I guess there are some interested parties in the assets of RideQ. 
 

MSFT ATVI discount to buyout price looks interesting as well. Seems like free money on the table (knock on wood). 

[wisowis]

8 hours ago, ValueMaven said:

Has anyone looked at the JNJ-KVUE swap?  It's an interesting one.

You buy 99 shares of JNJ and swap it into KVUE at a meaningful discount.  It's about a 17% return in 2 weeks time.  

If you buy 100 shares you want be guaranteed a full swap, and if you buy 99 shares and don't allocate the full 99 shares, then you will lose out as well.  KVUE also has sold off and seems cheap to me given its business and moat.  Hedge Funds cant do this (99 share issue) and most retail is unaware of the transaction.  

 

Interesting idea, but how do you get 17%? As of Friday, JNJ shares closed at $173.85, KVUE closed at $23.72. Indicative ratio (as of Friday) was 7.9334x (per https://www.envisionreports.com/jnjseparation/2023/JNJSeparationaug11/index.html?voting=true). 

 

That gives me an 8.2% return, unless I am missing something?

 

[lnofeisone]

8 hours ago, ValueMaven said:

Has anyone looked at the JNJ-KVUE swap?  It's an interesting one.

You buy 99 shares of JNJ and swap it into KVUE at a meaningful discount.  It's about a 17% return in 2 weeks time.  

If you buy 100 shares you want be guaranteed a full swap, and if you buy 99 shares and don't allocate the full 99 shares, then you will lose out as well.  KVUE also has sold off and seems cheap to me given its business and moat.  Hedge Funds cant do this (99 share issue) and most retail is unaware of the transaction.  

I saw this popped up on Barron's and meant to look at it further. thanks for the reminder!

[UK]

11 hours ago, ValueMaven said:

Has anyone looked at the JNJ-KVUE swap?  It's an interesting one.

You buy 99 shares of JNJ and swap it into KVUE at a meaningful discount.  It's about a 17% return in 2 weeks time.  

If you buy 100 shares you want be guaranteed a full swap, and if you buy 99 shares and don't allocate the full 99 shares, then you will lose out as well.  KVUE also has sold off and seems cheap to me given its business and moat.  Hedge Funds cant do this (99 share issue) and most retail is unaware of the transaction.  

 

Thanks!

 

https://www.barrons.com/articles/jnj-kenvue-stock-price-odd-lot-rule-96aa9b74

 

Also: One potential positive is that arbitragers have been buying J&J and selling short Kenvue to take advantage of the 7.5% spread. This has depressed Kenvue by about 3% since the deal was announced in July while J&J is up about 2%. This could mean that Kenvue may appreciate once the deal is done and that trade is unwound. When General Electric did an exchange offer for Synchrony Financial in 2015, GE stock outperformed before the deal and Synchrony outperformed GE immediately thereafter.

 

And: https://finance.yahoo.com/news/kenvue-set-join-p-500-224200805.html

 

 

[Malmqky]

Some $50 limit orders for JOE

[lnofeisone]

99 shares of JNJ and tendered all of them. The TD rep said that she's been fielding JNJ tenders all morning. 

[mike_3772]

Likewise

[Castanza]

MANU, ATVI 

[rkbabang]

On 8/14/2023 at 9:50 AM, Malmqky said:

Some $50 limit orders for JOE

 

That belongs in a thread "what do you wish you were buying today"

 

[rkbabang]

Added a little to SE, this is the lowest I've paid for it.  Lower than my original buys in 2020.

And of course BTC (which I add to just about every week).

[Luke]

I sold Micron at slight gain and added proceeds to Nintendo. I am trusting that Li Lu has a better understanding than me of micron and that the situation with China is not favorable for the DRAM market. 

Edited August 15, 2023 by Luca

[Lance]

Small adds to AB, LEG, STI, TRC and WTW.

 

Thanks

Lance

[Castanza]

AIV, FRPH

Edited August 16, 2023 by Castanza

[Whensthepaintdry?]

More BOC. 

[brobro777]

Bought some TSLA put options

[formthirteen]

ATRI, TLT LEAPS

Edited August 16, 2023 by formthirteen

[Lance]

Added to BTI.  

 

New positions in LAMR, OUT and OWL.

 

Thanks

Lance

[Saluki]

Added a little NTDOY and FRFHF

[Viking]

Canadian telecom stocks have been taken out behind the woodshed: Telus, BCE and Rogers. All are trading at or close to where they were trading 5 years ago. At current prices, investors get an average dividend yield of 5.6% with decent chance of capital appreciation (especially if interest rates go lower in 2024 or 2025). 

 

Telus = 6.3% current dividend yield

BCE = 7%
Rogers = 3.6%

 

Historically, Canadian telecom is an oligopoly where the players want to make money (but not too much). BCE and Rogers also own significant assets (sports franchises) so they are not just a telecom play. 
 

The big news from a competitive standpoint is the #4 player (Shaw) just got bought by Rogers. The two big risks i see are interest expense (these guys carry a lot of debt) should interest rates stay at current levels for another 4 years or longer. And regulatory risk (Trudeau does something stupid). But even then, my guess is the players will simply adjust their models so they continue to hit their return targets. 
 

My strategy is to simply buy a basket of all three (skewed towards T and BCE because of the higher yield) as i do not have enough knowledge/conviction to know who is better valued today. Would love to hear what others think. 

 

Edited August 16, 2023 by Viking

[Parsad]

6 minutes ago, Viking said:

Canadian telecom stocks have been taken out behind the woodshed: Telus, BCE and Rogers. All are trading at or close to where they were trading 5 years ago. At current prices, investors get an average yield of 5.6% with decent chance of capital appreciation (especially if interest rates go lower in 2024 or 2025). 

 

Telus = 6.3% current dividend yield

BCE = 7%
Rogers = 3.6%

 

Historically, Canadian telecom is an oligopoly where the players want to make money (but not too much). BCE and Rogers also own significant assets (sports franchises) so they are not just a telecom play. 
 

The big news from a competitive standpoint is the #4 player (Shaw) just got bought by Rogers. The two big risks i see are interest expense (these guys carry a lot of debt) should interest rates stay at current levels for another 4 years or longer. And regulatory risk (Trudeau does something stupid). But even then, my guess is the players will simply adjust their models so they continue to hit their return targets. 
 

My strategy is to simply a basket of all three - as i do not have enough knowledge/conviction to know who is better valued today. Would love to hear what others think. 

 

 

It's funny you posted that.  I spent most of last night going over a bunch of TSX stocks with dividend yields on average of 5%+ and a P/E of about 15, while watching the Australia/England FIFA Women's World Cup game. 

 

If you think about the run the USD has had over the last couple of years and at some point we have to head back to a normalized exchange of around 1.15-1.20 USD to CDN, Canadian stocks may hold some promise here relative to US stocks in the next year or so.  Cheers!

[Paarslaars]

Come on you must be joking...

 

 

 

 

 

 

No one watches the women's cup.

Edited August 17, 2023 by Paarslaars

[Parsad]

54 minutes ago, Paarslaars said:

Come on you must be joking...

 

 

 

 

 

 

No one watches the women's cup.

 

I've watched almost every game. 

 

I've been going to sleep around 3am every other night for the last 2 weeks!    That's why I can't sleep tonight either...will have to get back to my old schedule of going to bed by 1am.

 

The two semi-final games were fantastic!  I'm expecting a great final between Spain and England.

 

If you saw the Australia/England semi-final last night...I was up to 6am...every goal was brilliant, especially Sam Kerr's!

 

Women's football is now at the point where women's tennis has been for the last 45 years.  On par with the men's game!  I hope salaries start to catch up like they did in tennis. 

 

I hope to see the same for women's golf too!  Rose Zhang is going to be as good as Phil Mickelson, better than Annika Sorenstam, and may be close to Tiger Woods one day!

 

It's about time!  My niece will have lots of choices when it comes to female sports role models!  Cheers!

 

 

[thowed]

Amen, Sanjeev!

 

I may be a bit biased as an England supporter.

 

But yes, can't deny that phenomenal Sam Kerr goal.

[bizaro86]

3 hours ago, Paarslaars said:

Come on you must be joking...

 

 

 

 

 

 

No one watches the women's cup.

 

I'm on vacation in Australia right now, and they're definitely following it here. Random tourist guides mention it in their spiel, signs/ads everywhere, etc.