Well, I think the good news is that Bay held at yesterday's close today($26 3/8), despite opening down and the market and techs(Nasdaq) having a down day. I just wished I had a better read on this quarter, now that it is half over. M&A rumors will only hold up the stock so long, and then either they crystalize or the fundamentals must improve. Otherwise, we are back in the low 20"s.
I agree that the current rumors will hold the stock at about these levels($25.5+) until the June trade show. If nothing materializes then, the market will look to the company for signs on how the quarter will finish. Analysts will check their VAR sources, and opinions will be given. Bay needs to make this quarter's numbers(assuming no acquisition in June) to bolster the stock until we get close to Oct, when the LU rumors will surface with a vengeance. Bad numbers this quarter means that LU can come in with a low bid too.
As I have said before, Bay will be in a much stronger bargaining position for price if they have strong fundamentals. Their legal fidicuary responsibilities will make it difficult to reject a reasonable offer out of hand(say, +50% over average price past 6 months). That would be an offer in the mid-$30's, not $80!! Anything over the company's all-time high($42+) would make everyone whole and be difficult to reject, if the stock is trading 40% off that high.
How you handle your ownership of Bay in the interim is dependent on your investing style and objectives. You can assume a narrow range of $25.5-$28.25 on an intraday basis, without any new news, for the rest of the month. If you want to trade in and out to capture a point here and there, go ahead. Just realize you may be "out" when you finally want to be "in".
As always, the ramblings of frustrated investor. We will know in time.
Paul |
