ManTech International Corp VAMANT$84.41 Buy
BlackstoneBX$112.46Buy
Natus Medical IncNTUS$33.46Buy
HasbroHAS$87.84 Buy
TPGTPG26,65 $
We discuss mergers and acquisitions: someone buys ManTech, Blackstone — American Campus Communities, medical investment fund — Natus Medical, Hasbro — D&D Beyond.
Disclaimer: when we talk about, that something has grown, we mean a comparison with the same quarter a year earlier. Since all issuers are from the USA, then all results in dollars. When creating the material, sources were used, inaccessible to users from the Russian Federation. We hope, Do you know, what to do.
Men's Technology: defense contractor ManTech has almost found a buyer
Defense IT Contractor ManTech International (NASDAQ: MANT) attracted the interest of potential buyers.
They name a few: KBR's science and technology business (NYSE: KBR), Carlyle Group Investment Fund (NASDAQ: CG) and private technology company Peraton. Parts, Unfortunately, not yet.
I must say, that the company's shares are now far from historical highs: they are standing 84,6 $, which is less 101 $, who asked for shares in January 2021.
Speech, seems to be, is about the sale of a controlling stake by company founder George Pedersen, who in February announced his resignation from the board of directors.
All in all, ManTech is an attractive business.: the opportunities for mastering the US military budget in IT are truly endless. And the company is cheap.: P / S — 1,35, P / E — 25,29, and its capitalization is only 3.45 billion.
So that, maybe, it makes sense to take these shares now in the hope that, that applicants will begin to bargain with each other for ManTech.
Romance of the hostel: Blackstone buys American Campus Communities
Blackstone Investment Fund (NYSE: BX) buys REIT American Campus Communities Manager (NYSE: ACC).
Here's what investors need to know about this deal:
- ACC buy for 12.8 billion, including debt, and excluding debt - for 9.2 billion;
- shares are bought at a price 65,47 $ - it's with a premium 14% to the stock price at the time of the news. Stocks are bought at a price above their all-time high;
- ACC buy with P / E 280 and P / S 10. Looking at the more REIT-relevant metric "share value to operating profit ratio", then it will be there 30,45. It's not crazy much., but not a little;
- the dividend yield of this REIT is 1,88 $ per share per year. Regarding the purchase price of the company, it turns out 2,87% per annum.
In my opinion, ACC is a rather dull and not very high-margin business, therefore, its purchase by the Blackstone fund can only be explained by an excess of money from this fund, as well as his desire to receive passive income twice as high as the average for S&P 500.
However, anyway, this news is good not only for ACC shareholders, but also for other investors.
Firstly, huge spending in student housing shows, what "money bags" count, What can you earn in education?. And that means, what you can look at the shares of educational startups.
Blackstone's logic seems wrong to me: seems to be, the pandemic will never end and it will be a serious deterrent to the development of everything, what is connected with offline education. But then, what is connected with the digitalization of education, may well shoot.
Regarding the purchase of ACC, it seems to me, some grandfather lobbied her in Blackstone, because "well, what are you doing, all the power in the earth, not in your startups, need real assets!». If my hypothesis is correct, then we can hope, that the exchange will begin a trend to buy discreet conservative businesses in the "real" sectors.
Secondly, if funds buy exorbitantly not very interesting REITs like ACC, then, maybe, REITs in more promising industries like logistics and cloud computing will also attract buyers.
Blow - it will work: we analyze the purchase of Natus Medical medical technology
Medical investment fund ArchiMed acquires medical solution provider Natus Medical (NASDAQ: NTUS).
Here are the deal details:
- in absolute terms, the purchase of the company will cost the fund $1.2 billion;
- buy a company at a price 33,5 $ per share. The premium to the share price at the time of the news is approximately 29%;
- Natus buy with P / S 2,4 and P / E 85,93;
- Natus is a manufacturer and supplier of software and devices in the field of medicine - as for treatment, as well as for diagnostics. The company's revenue is divided into the following areas of medicine: neurology - 60%, newborns - 22% and auditory and vestibular apparatus 18%. Company's sources of revenue: devices and software - 75%, consumables and spare parts — 22%, services - 3%. In the US, the company makes 60,4% proceeds, and 39.6% give others, unnamed countries;
- buy a company at a price, far from its historical highs: back in December 2015 they asked for these shares 48 $.
Confess, Natus looks even less promising as an asset, than ACC: everything is very uneven with profit there and there is no wild growth in revenue. Most likely, the fund was attracted by Natus' high gross margin: recent 3 She hasn't gone down in years. 50% from proceeds.
Clean bookkeeping could also have an impact.: there is more than enough money at the disposal of the company to close all its debts. Well, the low price in absolute numbers: the company is worth less than $1.5 billion.
Probably, the fund plans to carry out cannibalistic reforms in the company with mass layoffs and other repressions, to realize the hidden value of this enterprise, indicated by its large gross margin.
It seems to me, practical conclusion can be drawn from this story: it makes sense to look for fallen shares of stagnant medical companies with hidden potential - suddenly someone will buy them with a good premium to the current price.
Had, bro: new deal for Dungeons & Dragons
Toy and board game manufacturer Hasbro (NASDAQ: HAS) buys service D&D Beyond (D&DB). The value of the transaction is 146.3 million dollars.
D&DB allows you to create characters and game situations for Dungeons board games & Dragons, and also provides access to rulebooks. The service has 10 million registered users, and he pays royalties to Hasbro with 2017 - and the sum of them, according to representatives of Hasbro, very big, but not exactly known.
Those are also interesting, who buy D&DB: the site belongs to the site Fandom. Fandom contains various fan-made wikis on various fictional universes. For example, after "Gorca". Fandom, By the way, owned by the American investment fund TPG (NASDAQ: TPG).
This deal comes in the context of an attack by activist investors and fans of the Wizards of the Coast board games to force Hasbro to strengthen the former as its most marginal and successful division - or even list it as a separate company.. I covered this story in detail in the news and even made an investment idea based on it..
Purchase D&DB should be taken as a sign that, that Hasbro heard shareholders and is working to strengthen Wizards of the Coast - including through the development of an online game mode: D&DB is used by many players as a tool to prepare for online tournaments.
But it is also worth considering, that Hasbro recently released a report that was not particularly pleasant for investors, the worst part of which was the decline in operating margin from Wizards of the Coast segment revenue from 45.4 to 40,5%. Mostly, the "toy" segment is even worse: operating margin fell from 4,9 to 1,3%. The main reason for the decline in margins is the growth of logistics costs and the cost of goods.
The current reporting results can be considered evidence of the fallacy of Hasbro's strategy in previous years., when she underinvested in Wizards of the Coast, spending on unprofitable media segment.
And now we see, that Wizards of the Coast is the main earner and its share in the company's total profit is growing. Although the overall financial result jeopardizes the company's ability to pay dividends: logistical troubles threaten to get worse in the next six months due to quarantines in China.
Will hope, that purchase d&DB will not be the last step in the development of Wizards of the Coast - and, may be, over time, this division will fulfill the same role for Hasbro, what is cloud computing for Microsoft.
