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Airgas, Inc. Message Board

  • lnhirst Dec 12, 2010 11:00 AM Flag

    I'm not really certain what is positive or what is negative anymore.

    When I saw ARG start to rebound off the regular session closing price in afterhours last Friday, I almost picked up additional shares. I then decided not to do so, being concerned about a rejection announcement over the weekend.

    I now suspect that share value will initially advance at the open Monday and then pullback, if no announcement has been been made. If prior to the open, there is a rejection officially announced, it should pull back. If the offer of 70 bucks is officially acccepted, then the stock will obviously advance. Since the possibility exists of litigation down the road, as some may argue that ARG management initially practiced deception, it muddies the waters all the more. This is the strangest stock trading/investing situation I have been involved in since I started doing this about 1970. The OMX and Michael Feuer circus of the late 1990's was goofy, but this ARG situation is the ultimate.

    We don't even know what some of the big players in terms of controlling interest of shares want at this point. If you "stand back" and look at the debacle, it's somewhat ludicrous and absurd.

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    • I would buy the call options and not put much into the stock and tie up that kind of money. The premiums are pretty cheap, telling me that some smart money thinks that ARG will prevail. They aren't going to accept $70/share. I'd like to see ARG take themselves Private, since they think they are that undervalued. PX would have made an Offer, by now, if $78/share was cheap, per ARG statements. This one has lasted a LONG time. On its own, ARG may do fine, anyway.

    • If you are a genuine investor, the choice is simple: Hang on to the shares. You will eventually see well over $70, whether or not this deal goes through. APD would not be doing all of this if they didn't think the company was worth *at least* the offer price.

      If it was a speculative buy, you need to understand one crucial point: when a decision is made--positive or negative--you will not hear the news until after the Street has already reacted (I am talking about seconds here, but that's all it takes.) So place your bet and wait until Jan. You will not be able to move faster than the big boys.

      • 3 Replies to nesmithbrian
      • "I would like to acquire more shares 'now'."

        I opened a position on Thurs. around $62, figuring that with an offer at $70, there had to be upside.

        Personally, I am not going to add to that position: it could go to higher than $70, but there would have to be a major event for that. Risk/reward now seem skewed towards the downside.

        So for what it's worth, I would hold existing positions, and not add to them. I have screwed myself so many times by adding to winning positions and thereby ending up with a loser that I try to consciously hold back from doing so.

      • lnhirst Dec 12, 2010 12:48 PM Flag

        I believe that you may be missing part of my point. I would like to acquire more shares "now". However, if there is a rejection Monday, there will be a pullback. That's when I will be kicking myself for being impatient and not waiting longer to pick more up at a cheaper price. I've got 87k on the sidelines waiting for the right time to increase my holdings. For me that is not "chicken feed".

        Point taken regarding the big boys and the rapidity with which things will occur.

      • Priority of News Disemination:
        First: Insiders.
        Second: Big Money.
        Third: Court.
        Fourth: Public.
        It can be long time between first & fourth. At fourth, the news is actually HISTORY.

    • I feel much the same as you. I'd like to buy more but the swings are too wide. This could be Big Money shaking out us little guys at a cheaper price, as they bet on a sale north of $70. This BofD appears to be acting in THEIR best interest. A synergy of the sale would be one less Board. The downside to current price is limited. The upside is conservativly $7 to $11. JMHO

      • 1 Reply to hardwood1400
      • pentwater speaks for all funds!!! how could they risk siding with management who want to keep their high paying jobs and dont care if the stock deal falls and price drops to 50 dollars a share.. NOONE wants to see another YAHOO deal fall apart... All these funds are in for the short term performance and coming to year end they surely dont want another loser on the books but rather a winner and who cares if they sold 2- 4 dollars less....

    • Don't know that I agree. If the board is split, as now seems to be officially the case, the burden of proof is now on the non-dissenting members to show that rejecting the offer is in the interests of shareholders, even though prominent ones have publicly denied this is the case.

      Hard to see how we will fail to rally into the high 60's, at least unless the board decides to ignore all these factors and rejects the offer out of hand. Once again, that seems all but impossible in the current scenario.

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