Posts by Pras Subramanian

  • 3 takeover targets for risk-seeking investors

    Pras Subramanian at Yahoo Finance6 days ago

    We've got inversions, consolidations, and companies shedding units to one another. With all the corporate buying and shuffling, investors with a higher appetite for risk are likely asking themselves how they can partake in this game.

    Tobias Carlisle, author of the new book Deep Value: Why Activist Investors and Other Contrarians Battle for Control of Losing Corporations , has a plan of attack.

    Carlisle has devised a formula for figuring out likely takeover targets. “I use a metric called the acquirer’s multiple, which is very similar to the enterprise multiple,” he says in the attached video. “It looks for cash-rich balance sheets and very strong operating earnings in relation to the price that you pay for the business. So it’s the sort of thing that’s very attractive to activist investors, private equity firms, and LBO shops.”

    The Santa Monica-based Carlisle has ran the numbers and given us three companies that look like very attractive takeover targets.  

    Valero Energy (VLO)

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