The Fed’s statement suggests weakness in the economy, along with concern over trade talks with...
A Look at Loews
04/28/2017 2:50 am EST
Loews Corp. (L) has finally made a long-awaited new acquisition, spending $1.2 billion of its $5 billion cash hoard to buy Consolidated Container Company, a plastic packaging manufacturer, notes Adrian Day, editor of Global Analyst.
If not exactly exciting, the company meets Loews’ acquisition criteria as set out by CEO James Tisch: it is in a fragmented industry offering opportunities for further acquisitions.
In addition, the acquisition meets Tisch's criteria for a company having strong cash flows, and ones that are unlikely to be subject to major technological disruption.
The acquisition also diversifies Loews’ portfolio into a relatively stable area to help offset the volatile oil and gas sectors.
Loews, trading at a 14% discount to its Net Asset Value, with upside potential from its oil and gas as well as more steady cash flows from its hotels and insurance units, and a still rock-solid balance sheet, remains a long-term holding.
Given the discount is well below historical average, we would look for a wider NAV discount to step up additional buying.
Related Articles on MARKETS
Even relative to the market’s dovish expectations, the FOMC came off as worried about the U.S....
Business development companies (BDCs) lend money to private companies in the form of fixed and varia...
We are initiating coverage of L’Oreal Inc. (LRLCY), the world’s largest cosmetics compan...