Investment bankers are notorious for predicting a boom in corporate activity. For once, they might be right. Talk of a record year for Initial Public Offerings is well grounded, with several multi-billion-dollar offers on their way. And mergers and acquisitions (M&A) activity is finally heating up.
Investors who seek quality companies with takeover appeal must also identify a catalyst for M&A. Stocks are often touted as perennial takeover targets on the basis that they are undervalued. That is too simplistic. More important is understanding a trigger for a predator to pounce, and to pay way above the odds because the target company has significant strategic value that is hard to replicate.
Below are six takeover targets: