Posts for Ticker ‘COV’

George Soros Top Equity Holdings (AAPL, AUXL, BFLY, CBI, CMG, CRUS, COV, MAPP, POT, SVNT)

This week we got to see critical SEC filings showing holdings of many key and influential investors.  Included in these filings were billionaire George Soros, a billionaire whom is loved by some and much less ‘well thought of’ by others over his currency trading history of over his MoveOn.org attempts.  Either way, investors still watch Soros.  These are the holdings of Soros Fund Management LLC as of December 31, 2007.  These were listed as the top holdings and are not at all his entire positions.  Soros Fund Management LLC was listed as having some $2.269 Billion in the total filing, and these positions here only equate to $360+ million, so there are many more positions.  As with all of these holdings, these positions may have changed or been eliminated as of the dates noted.  Here is a summary of his larger positions with a dollar amount provided by Soros as filer and a share count:

  • Apple Inc. (NASDAQ: AAPL)   $32,000,000;  161,550 shares
  • Auxilium Pharma (NASDAQ: AUXL)   $36,473,000;  1,216,180 shares
  • Bluefly Inc. (NASDAQ: BFLY)   $36,451,000;  48,601,156 shares… an old favorite of his…
  • Chicago Bridge & Iron Co. (NYSE: CBI)   $29,743,000;  492,100 shares
  • Chipotle Mexican Grill, Inc. (NYSE: CMG)  $32,404,000;  220,332 shares
  • Cirrus Logic Inc. (NASDAQ: CRUS)   $24,376,000;  4,616,666 shares
  • Covidien, Ltd. (NYSE: COV)   $32,194,000;  726,900 shares
  • MAP Pharmaceuticals (NASDAQ: MAPP)   $71,374,000;  4,076,169
  • Potash Corp. (NYSE: POT)   $37,933,000;  263,500 shares
  • Savient Pharmaceuticals (NASDAQ: SVNT)   $25,002,000;  1,088,461 shares

As Soros himself says …."Contrary to the tenets of market fundamentalism, financial markets do not tend towards equilibrium; they are crisis prone."   

Other billionaires and their holdings filed this week:
Bill Gates
Carl Icahn
Warren Buffett

Jon C. Ogg
February 16, 2008

Posted on: February 16, 2008 – 9:17 am in Insider Activity, , , , , , , , , ,

Turnarounds That Haven’t Turned Around: Tyco International (TYC, TEL, COV)

Tyco International Ltd. (NYSE: TYC) is a hard turnaround to call as one that hasn’t turned around because it has already begun its long-term initiatives to enhance shareholder values.  The problem is that it has been unsuccessful so far.  The company completed the spin-off of Tyco Electronics (NYSE: TEL) and Covidien Ltd. (NYSE: COV) on July 1, 2007.  Because of these spin-offs, Tyco was a much harder stock to cover and to use valuations and historical data on.  In fact, analysts from large brokerages and bulge bracket firms have had a hard time breaking down the de-conglomerized conglomerate.  We also want to caution that many figures used actually vary from source to source and this made analysis not as straightforward here in this case.

First, let’s look at the spin-off companies.  Tyco Electronics (NYSE: TEL) traded at $39.81 on a dividend adjusted basis at the end of July 2 and have fallen down to the mid to low-$30’s before a recent recovery. But even north of $37.00 shares are still down.  Tyco Electronics has a equally mixed coverage spread between Buy/Hold and an average price target of roughly $41.00 from analysts.  Covidien (NYSE: COV), the medical products entity, shares traded at $43.24 on a dividend adjusted basis at the end of July 2 and have traded in mostly in a high-$30’s to mid-$40’s basis since.  With a $44+ handle this one still has a mixed verdict depending upon whom you ask.  Covidien has a mixed opinion from a thin group of analysts and an average price target of roughly $47.50.  It seems that offspring aren’t being thought of as great growth vehicles.

But back to Tyco International Ltd. (NYSE: TYC).  Tyco International shares took a serious hit in late 1999, but they recovered sharply and hit new highs in 2001.  By early 2002 the accounting scandals and the Koz issues came full circle and shares were crushed.  On an adjusted basis the stock lost more than two-thirds of its value.  2003 to the end of 2004 were great years to own shares, but this hasn’t really been the case since then.

Back before these spin-offs were completed, we noted how there appeared to be a phantom premium in Tyco shares just because of the hype around the break-up and because of the craze surrounding private equity and shareholder initiatives.  What appears to have happened is that now the street has given it a more proper valuation or at least a more realistic one, and as we noted not all bad stories have to have sad endings.

On an adjusted basis Tyco International (NYSE:TYC) shares were over $50 at the July 1 date, but they have never been back.  Shares trade around $40 now and have been as low as $38-ish over recent weeks.  If you trust the "average price targets" from analysts, that appears to be around $50.00 from a much smaller group than in prior years.

Just last week a court approved some $3.2 Billion in investor class action law suit settlements over the accounting fraud took the company down.

We do caution against using any solid earnings forecasts because many analysts have not fully adjusted their opinions to reflect the "new" Tyco in a post spin-off world.  First Call has Fiscal September-2008 EPS at $2.61 (a 15.5 forward P/E ratio) and fiscal September-2009 EPS at $3.24 (a 12.5 forward P/E ratio), although we still question some of these since the spin-offs.  If the company can achieve those estimates, then there are few who could argue against this being one of the better value plays out there.

Most of our "turnaround stocks that haven’t turned around" are troubled companies in troubled predicaments that may have a very hard time making a turnaround come to fruition.  But Tyco may be one of the exceptions.  That phantom premium may be in the rear view mirror.  Its value is also now easier to see since the spin-offs have been completed and are basically two quarters on their own.  Who knows, maybe 2008 to 2009 will be Tyco’s time to shine.

Jon C. Ogg
December 28, 2007

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Posted on: December 28, 2007 – 6:29 am in Conglomerates, Turnarounds, Value Investing, , ,

The Tyco Aftermath (TYC, TEL, COV)

Tyco International Ltd. (NYSE:TYC) is one of those strange spin-off and restructuring stocks that has not done well since the company broke itself up.  The Tyco Electronics (NYSE:TEL) and Covidien (NYSE:COV) stocks have also fallen more than the overall market since the spin-off.  But not all bad stories have sad endings.  We will be sending out a tie to one of the new companies next week to subscribers of our Special Situation Investing Newsletter.

Before the Tyco (NYSE:TYC) break-up we had many inquiries for higher and higher price targets on Tyco, but the fundamental problem was that no matter how we crunched those numbers the math just didn’t work for Tyco’s stock price at the time.  We even called it a ‘phantom premium running Tyco shares’ ahead of the event because investors were too much in love with the private equity, mergers, and break-ups at the time.  That stock had a phenomenal run from last summer to this summer as the deal was quite well telegraphed, but nonetheless there existed a phantom premium. 

Posted on: August 28, 2007 – 8:20 am in Conglomerates, , , , ,

Tyco’s Parts One Week Later (TYC, TEL, COV, GE, MMM)

As you will see, so far the markets have greeted the post-Tyco with a bit of a thud.  This is one we were a bit cautious on the valuations as being fully valued and perhaps even having a phantom premium just because of the break-up itself.  Here you’ll see the pieces:

The remaining Tyco International Ltd. (TYC-NYSE) after a 1:4 reversesplit is down marginally at $53.00.  It opened at $52.92 Monday andhave managed to close up north of $53.00 per share each day since.Unfortunately each close has been slightly lower than the day before.

Tyco Electronics (TEL-NYSE) is trading at $39.30, barely above the opening price on Monday at $39.20.  Shares have briefly traded over $40.00 since the spin-off, but based on the trading activity it looks like the specialist was more than happy to give shares away there.

Covidien Ltd. (COV-NYSE) is up an entire penny today at $42.21 and have traded down from roughly a $43.00 open (conflicting opening prices).  It looks like the specialist was more than eager to give away shares at $43.00.

In all fairness, shares of other conglomerates haven’t exactly been lighting up the road: General Electric (GE-NYSE) has seen shares stuck in a $38.00 to $38.79 range for the last week, and 3M (MMM-NYSE) has seen only an $87.13 to $88.40 range in the same time.

Jon C. Ogg
July 6, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: July 6, 2007 – 10:19 am in Conglomerates, , , , ,

Previewing Tyco Spin-Off Ahead of Analyst Meetings

Stock Tickers: TYC, COV, COV-WI, TEL, TEL-WI, GE

Tyco International Ltd. (TYC-NYSE) hosts its analyst meetings on Tuesday, June 19, to showcase its new spin-off companies.  Late last week we saw trading begin in the two spin-offs.  The "Tyco Healthcare" is named Covidien Ltd. and is trading under a when-issued ticker "COV" or on most symbols as "COV-WI."  The "Tyco Electronics unit" is appropriately named Tyco Electonics and trades as "TEL" or "TEL-WI."   The remaining company for all of the security and fire company is remaining Tyco International and keeping the "TYC" ticker.

Covidien (COV) closed out at $46.50 on Friday and Tyco Electronics (TEL) closed out at $38.80 on Friday.

In our free email newsletter we sent out last week, we noted that the break-up value for all of the combined Tyco International units could could fetch up to $36.00 or $37.00, but the stock was looking like it was set in a bumper car range of $32.00 to $35.00.  It just seems as though there is a phantom premium in the stock based solely on the actual spin-offs as an event rather than as the spin-offs’ true values.

Last week we also noted that Goldman Sachs had reiterated a "Buy" rating on the stock with a much more positive outlook.  Goldman noted that Tyco could even have a premium to their $35.00 target, which they even noted as ‘conservative.’    Our $36.00 to $37.00 note was sent on June 12 when the market was trading off, so the better stock market will be a boost for it.  Here was what we noted: If the market was not in a back-and-forth mode and if this wasn’t taking place into the 4th of July it might be a tad different.  But, only a tad.

A group of dissident bondholders late last week also noted that they are trying to get Tyco’s deal delayed, but the company said they remain on track after two delays already.  The company is also taking a $370 million after-tax charge this quarter related to sale of a power systems unit out of the electronics unit

We’ll send out more individual previews before and after the analyst meetings when we get to see the full presentations and hear what other plans are coming for each unit. 

Tyco trades too in-line with General Electric (GE) for the relative value to be incredibly higher than the market value of today, and shares have come up more than 36% from the lows over the last year before the spin-off was set in stone.

Jon C. Ogg
June 17, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 17, 2007 – 5:57 pm in Analyst Calls, Conglomerates, Mergers and Buy Outs, Shareholder Issues, , , , , ,