A few short hits fora hot summer day –
- Scuttlebutt Investor recently revisited CDK Global (CDK) and offered his thoughts on the company’s recent performance and transformation plan. The company was just spun off from ADP (ADP) last October, but the dealer services company quickly attracted the interest of several different activists. They seem to have become very involved at the company and it’s tough to argue with the results. The name has delivered very strong returns during its brief existence, but the real question is what does it still have to offer?
- BorgWarner (BWA) recently announced that it would acquire engine starter and alternator maker Remy International (REMY) for $29.50 per share. The price represented a hefty premium to its previous close. Fidelity National Financial (FNF) had acquired a large equity stake in the company as a result of its 2007 bankruptcy and its large ownership had created liquidity issues and an overhang on the shares. To help alleviate those issues and shed some assets, the company was spun out of Fidelity National Financial Ventures (FNFV) at the very end of 2014 (literally the end – December 31st). Shortly after the spin, Barron’s published a bullish piece on the company predicting over 40% of upside due to strong vehicle growth and the improved post-spin trading situation. The piece also highlighted a bullish analyst from B. Riley who slapped a $29 price target on the name. Well…this was probably not what they had in mind, but kudos for a good call anyway. Another spin success story.
Disclosure: Author holds no position in any stock mentioned.