September 22, 2011 |
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Goodrich (NYSE: GR��) climbed 10% on Thursday after United Technologies (NYSE: UTX��) agreed to buy the aerospace manufacturer for $16.5 billion, or $127.50 per share.
So what: The all-cash deal represents just a 16% premium to Goodrich's Wednesday closing price, but it's about 50% higher from where the stock was late last week, before the news started leaking. United Tech is making the acquisition, its largest ever, to broaden its portfolio and, specifically, boost its presence in the civilian aerospace market.
Now what: While Goodrich shares are probably all popped out, United Tech might be worth a closer look. "Goodrich delivers on all of our acquisition criteria," United Tech Chairman and CEO Louis Chenevert said. "It is strategic to our core, has great technology and people, and strengthens our position in growth markets." The deal isn't expected to close for several months and may not even boost United Tech's earnings for a few years, but pouncing on its beaten-down stock price now may pay off over the long run.
Interested in more info on Goodrich? Add it to your watchlist.
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