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When analysts identify a company as a potential takeover target, it often indicates that the company has efficient operations, or at the very least is a threat to its competitors. Additionally, takeover targets often jump in stock price on the announcement of a takeover. For these reasons, some investors consider takeover rumors when choosing investments...

We found a list of potential takeover / leveraged buyout (LBO) targets, from rumors of various sources such as Barrons, CNBC, UBS and Street Insider. Among this list, we screened for those with significant drops in put/call ratio over the last two weeks, indicating bullish sentiment (i.e. more call options relative to put options). To access the complete list of takeover targets, click here.



Do you think these names are likely to be taken over? Use this list as a starting-off point for your own analysis...

List sorted by decrease in put/call ratio.

1. Fidelity National Information Services, Inc. (FIS): Business Services Industry. Market cap of $10.04B. Takeover / LBO rumor sourced from Barrons. Put/Call ratio has decreased 51.52% over the last ten trading days (from 0.66 to 0.32). The stock has a relatively low correlation to the market (beta = 0.6), which may be appealing to risk-averse investors. The stock has gained 26.16% over the last year.



2. Penn National Gaming Inc. (PENN): Resorts & Casinos Industry. Market cap of $3.12B. Takeover / LBO rumor sourced from The Globle and Mail. Put/Call ratio has decreased 40.38% over the last ten trading days (from 0.52 to 0.31). The stock is a short squeeze candidate, with a short float at 5.9% (equivalent to 6.19 days of average volume). The stock has gained 25.02% over the last year.



3. BMC Software Inc. (BMC): Application Software Industry. Market cap of $8.92B. Takeover / LBO rumor sourced from Street Insider. Put/Call ratio has decreased 35.00% over the last ten trading days (from 0.4 to 0.26). Risk-averse investors may appreciate that BMC has a relatively low correlation to the market (beta = 0.71). The stock has gained 26.94% over the last year.



4. Qiagen NV (QGEN)
: Biotechnology Industry. Market cap of $5.0B. Takeover / LBO rumor sourced from Investopedia. Put/Call ratio has decreased 34.72% over the last ten trading days (from 2.16 to 1.41). The stock has lost 7.09% over the last year.

5. Amdocs Ltd. (DOX): Business Software & Services Industry. Market cap of $6.21B. Takeover / LBO rumor sourced from Street Insider. Put/Call ratio has decreased 30.77% over the last ten trading days (from 0.78 to 0.54). This is a risky stock that is significantly more volatile than the overall market (beta = 2.61). The stock has lost 4.22% over the last year.

6. Varian Semiconductor Equipment Associates Inc. (VSEA): Semiconductor Equipment & Materials Industry. Market cap of $3.10B. Takeover / LBO rumor sourced from UBS. Put/Call ratio has decreased 29.82% over the last ten trading days (from 0.57 to 0.4).

7. Symantec Corporation (SYMC): Security Software & Services Industry. Market cap of $14.92B. Takeover / LBO rumor sourced from Street Insider. Put/Call ratio has decreased 29.73% over the last ten trading days (from 0.37 to 0.26). The stock has gained 17.49% over the last year.

8. Kellogg Company (K): Processed & Packaged Goods Industry. Market cap of $21.0B. Takeover / LBO rumor sourced from UBS. Put/Call ratio has decreased 28.30% over the last ten trading days (from 0.53 to 0.38). Risk-averse investors may appreciate that K has a relatively low correlation to the market (beta = 0.46). The stock has gained 7.91% over the last year.

9. Massey Energy Co. (MEE): Industrial Metals & Minerals Industry. Market cap of $6.98B. Takeover / LBO rumor sourced from Street Insider and CNBC. Put/Call ratio has decreased 25.18% over the last ten trading days (from 1.39 to 1.04). This is a risky stock that is significantly more volatile than the overall market (beta = 2.06). The stock has gained 81.67% over the last year.

10. SLM Corporation (SLM):
Credit Services Industry. Market cap of $8.81B. Takeover / LBO rumor sourced from Street Insider. Put/Call ratio has decreased 24.53% over the last ten trading days (from 0.53 to 0.4). The stock is exhibiting strong upside momentum--currently trading 7.78% above its SMA20, 10.77% above its SMA50, and 28.41% above its SMA200. The stock has gained 30.47% over the last year.

11. Teradata Corporation (TDC): Diversified Computer Systems Industry. Market cap of $9.34B. Takeover / LBO rumor sourced from Street Insider. Put/Call ratio has decreased 23.81% over the last ten trading days (from 0.21 to 0.16). The stock has gained 87.81% over the last year.

*Options data sourced from Schaeffer’s, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 11 Takeover/LBO Targets With Bullish Options Sentiment