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Strategies & Market Trends : Speculating in Takeover Targets -- Ignore unavailable to you. Want to Upgrade?

To: richardred who wrote (540)	12/11/2004 10:00:50 PM
From: richardred	Read Replies (1) \| Respond to of 7265

Shares of health care giant Johnson & Johnson (nyse: JNJ - news - people ) and medical device maker Guidant (nyse: GDT - news - people ) moved in opposite directions on Tuesday after reports indicated the companies were in talks concerning a possible J&J buyout of Guidant for more than $24 billion. J&J shares closed Tuesday at $60.41, down $1.42, or 2.30%, while Guidant stock rose to $72.35, up $3.60, or 5.24%. Credit Suisse First Boston said J&J shares will trade lower if the company were to purchase Guidant for more than $76 to $77 per share. Based on the research firm's models, a "value neutral" takeout price for Guidant is $76.27. "2003 marked J&J's 70th consecutive year of top-line growth and 18th year of double-digit earnings increases. However, with heightened competition for nearly every one of its key device and pharma franchises, J&J's stellar financial track record seems at risk and in dire need of a new leg of growth," CSFB said. The research firm has "neutral" ratings for both J&J and Guidant. J&J stock closed Friday at $60.25, down $1.06, or 1.73%, while Guidant stock fell to $71.55, down $2.20, or 2.98%. forbes.com