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Annotated article summary from this weekend's Barron's. Receive all our Barron's summaries by signing up here:

Drop-Dead Beautiful Shares by Michael Santoli

Summary: "Just because everyone seems to believe the acquisition fever is in itself making stocks drop-dead attractive doesn't make it wrong -- yet." True, this year has seen $5 billion-plus acquisitions on 26 of its 95 trading days (on which the single-day return doubled its Liquidity1 20 05 2007average for the year), but plenty of the action has been in distressed stocks already disdained by investors such as Bausch & Lomb Inc. (BOL), Affiliated Computer Services Inc. (ACS), Dollar General Corp. (NYSE:DG), Tribune Company (TRB) and SLM Corp. (NASDAQ:SLM). Average buyout premiums of only 20-30% (Microsoft's 80%-premium acquisition of aQuantive Inc. (AQNT) notwithstanding) still have room to go up before M&A fever subsides, says HSBC's Kevin Gardiner. Deals have thus far been logical, strategic moves, not the frenzied buying associated with exhaustion tops. And despite the increasing concerns of international regulators that the current liquidity glut may be overdone, the spread between regulatory concern and action should give investors plenty of time enjoy the 'resilient ticker tape' before they need to get out. Gardiner: "The froth is yet to come."

Related Links: Is Confidence in the Economy Warranted?Currency, Debt and Stock Markets Point to 'Interesting Times'Market Surge: The Party's Not Over, But Keep an Eye On the DoorWhen Risk Outweighs Reward

Source: M&A Fever: The Froth Is Yet to Come - Barron's