Funny how the market works sometimes. I had been looking into Novell, which was an interesting idea brought up by longtime tech newsletter publisher Fred Hickey in this year’s Barron’s roundtable. I guess he was right because today hedge fund Elliott Associates offered to by the company for $5.75 per share, a 25% premium over yesterday’s market value.
Hickey had pointed out Novell’s large cash position making it an attractive stock. Nice job Fred! Wish we hadn’t been slacking on that one. In the meantime, I’m holding onto my Sybase (NYSE: SY) another Hickey pick, based on improving fundamentals and solid cash flow.Sybase holds $14 per share in cash and trades at a forward P/E of about 15 at a $44 share price.
What’s interesting about Novell is that it’s already trading above the buyout offer, indicating that the market thinks there may be other, higher offers. Definitely worth watching!