3 Takeover Targets You Can Bank On

money in the hands

deal_3002014 will be the year of the deal.

Private equity and hedge fund managers are on the prowl looking for bargains. With the easy money made in the market over the last few years, investors might be wise to follow the lead of these institutional managers.

In preparation for the onslaught, corporations are not sitting idly by.

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Hertz (NYSE: HTZ) initiated a poison pill strategy that kicks in when any investor acquires up to 10% of outstanding shares. The news sent shares soaring – not for the defense against activist investors, but the realization that Hertz cannot stop them when they arrive.

Like clockwork shortly after Hertz’s move, Carl Icahn opened a position in the stock. This is a follow-up to activist investors already owning stock in the company.

As for specific targets, it is easy to see where a company might be vulnerable. To the extent shares trade for a discounted valuation, consider the stock in the crosshairs.

Whether the outcome is activist investors making and demanding changes in strategy or the private-equity route of taking the company out entirely, the endgame for investors is appreciation in stock value.

While you might not make a huge windfall, you can score a quick 10-20% gain or more with these plays.

As such, it pays to identify these targets in advance.

Here are 3 stocks to consider for your portfolio today:

James (Jamie) Dlugosch is a contributing editor to MSN Money, The Street.com, InvestorPlace.com and Traders Reserve. He has a long and distinguished career in the investment industry that includes editorial and publishing stints with the highly rated Rational Investor, The Prudent Speculator and the current Penny Stock Winners. Jamie was a contributing editor to InvestorPlace Media where his content was syndicated to numerous on-line financial sites including MSN Money and AOL Finance. At the turn of the Millennium he was the President and CEO of Al Frank Asset Management where he honed his skills under the tutelage of the well respected guru, Al Frank. With The Rational Investor Jamie adapted Al Frank’s long-term market beating strategy to reduce risk and increase ease of use for subscribers. He was quickly rewarded for his efforts by compiling the second highest total return of all investment newsletters in 2004 according to The Hulbert Financial Digest. His investment approach has produced winning returns in competitions held by MSN Money in their long running Strategy Lab. He also has successfully raised private capital for a variety of private ventures including the purchase of Al Frank Asset Management, an investment now worth many times its original cost. Jamie is frequent guest and contributor to a wide range of financial television, radio and internet broadcasts including CNBC, Market Watch and MSNMoney. Jamie holds a B.A. in Political Science from UCLA and a Masters in Business Administration (MBA) from the University of North Carolina, Chapel Hill. He resides in Minneapolis, MN with his wife Sarah and two daughters, Julia and Ellie.

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