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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (61227)	8/23/2018 1:07:04 PM
From: E_K_S	Respond to of 78751

Bloomberg: ABB considering sale of power grid unit as value surges ABB ( ABB +1.9%) is considering the sale of its power grid unit, signaling a potential reversal in CEO Ulrich Spiesshofer’s plans for the business, Bloomberg reports. The CEO said last month that the power grid business is worth “much, much more today” than the $4B-$5B valuation given in 2016 and forecast that the unit was on track to deliver ~$1B of profit; according to a Bloomberg analysis, the unit’s implied valuation has increased to $10.2B following productivity and margin gains. A sale of the unit would meet a long-time demand of activist investor Cevian Capital, which became a major shareholder in ABB more than three years ago and began pushing for a breakup of the company, particularly a separation of the power grid unit. ------------------------------------------- Didn't realize that there was an activist Cevian Capital is an international investment firm acquiring significant ownership positions in European public companies where long-term value can be enhanced through active ownership. Cevian Capital is a Swedish investment firm founded in 1996 by Christer Gardell and Lars Förberg, both of whom serve as managing partners. Backed by Carl Icahn, it is the largest activist investment firm in Europe. It has offices in Stockholm, Zurich, and London. Formerly called Amaranth, Cevian has invested in such companies as ABB, Danske Bank, ThyssenKrupp, Volvo , G4S, TeliaSonera, and Lindex, and played a major role in the sale of Skandia to Old Mutual. ----------------------------------------------------- I was positive on ABB moving a lot of the Power Grid Management Services into the 'Cloud'. Maybe they could spin this off to shareholders as shares (w/ future growth) better than cash. The services generates excellent FCF. EKS

To: Spekulatius who wrote (61227)	9/8/2018 8:40:08 AM
From: Spekulatius	Respond to of 78751

SIEGY - I bought a few shares at $62.2. PE is around 13.8 based on the 2018 estimate provided by the company. Their BtB ratio of >1.1x indicates to me business growth near term, despite sustained weakness in their power segment (just like GE). I like that they spun of 29% if their health care business, which trades now at 20x earnings (or more) ad a value unlock. I also like that they I prove their market positions, by putting business lines into joint ventures. I think this is a better way to do so than outright buys for which they would need to pay higher multiples and pay up for most yet to be realized synergies upfront. this indicates smart capital allocation to me.