Well, LAB gained 3 points today in a very negative market, and trades above $33, higher than at any time since the rash of downgrades. The volume was not exceptionally great.
It would have been nice, if the price rose because a lot of people finally woke up to the fact that solid performers in this industry deserve better multiples than the derisory stuff that's been assigned to them traditionally.
Unfortunately, I suspect today's rise was due more to "window dressing" and takeover speculation. MF want to show in the report to the shareholders that they own the "winners", and LAB has done extremely well this year, so the knuckleheads buy at the last moment like today. And takeover speculation is rife on the street (BSC, LEH, NITE etc.), never mind that the big cheese said he's not interested in selling (to be fair though, every public company has their price, no?).
LAB will have to do an acquisition soon, to keep their growth momentum going, and I think Van Der Moolen could be a very interesting candidate. With LAB trading at a premium (to their historical p/e) and a weak Euro/strong dollar, this should not be overly painful. This would gain them a much increased presence on NYSE (VDM is #4 as of now) to solidify their dominance here, and VDM is also a fantastic way to participate in the European market, not just the regional Dutch (which VDM dominates), but the whole platform of EX (Amsterdam, Brussels, Paris). The EX might also do a bid for LSE, and become a de facto PanEuro exchange.
The natural acquirer of VDM would be NITE, but they blew it and their European strategy is in disarray (in fact the whole kaboodle is in such a sorry shape that there's wild talk and rumors on the street of NITE throwing in the towel and selling out). Regardless, NITE's loss could be LAB's gain, and a window of opportunity has opened up. I'm sure M.L. is well aware of this option.
Morgan |
