Friday, October 12, 2012

Trader’s Fav Stocks: Sprint Nextel Corporation(NYSE:S), Oshkosh Corporation(NYSE:OSK), Clearwire Corporation(NASDAQ:CLWR)

Sprint in talks with Softbank

Sprint Nextel Corporation(NYSE:S) has made a statement confirming reports that it is indeed in talks with the Japan based company Softbank about the latter taking a significant stake in the company.

“Although there can be no assurances that these discussions will result in any transaction or on what terms any transaction may occur, such a transaction could involve a change of control of Sprint,” read the statement. “Sprint does not intend to comment further unless and until an agreement is reached.”

There is also speculation that Sprint will buy shares of Clearwire as part of the deal, although Sprint’s statement made no mention of this. Clearwire’s shares reacted wildly to the news.

Sprint was trading at $5.76, up 72 cents or 13 percent. Clearwire was up a whopping 71 percent, up 92 cents, at $2.22.

Metro which had fallen on the assumption that Sprint would no longer bid for it, recovered from the lows of the day and was just 3 cents down at $12.01.

Icahn’s Oshkosh bid too low: Merrill

Truck maker Oshkosh Corporation(NYSE:OSK)’s biggest shareholder, Carl Icahn, has offered to buy the company’s remaining shares at 21 percent higher than Wednesday’s close. But BofA Merrill’s analysts are not happy with the price and want Oshkosh to continue to ‘block and tackle’ the activist investor.

Analysts Andrew Obin, Anna Kaminskaya, and Akshay Bhatia find the offer too low. Last month, the analysts had priced the stock between $35 and $38. It is trading at $29.86, 11 percent higher after Icahn’s bid. A premium of 20 to 30 percent would mean a price of $42 to $49. Icahn is offering only $32.50.
The investor had once planned to merge the company with Navistar International, but analysts are against the idea. They feel that such a step would not have created long-term value to the shareholders of Oshkosh.

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