CreXus (CXS) is downgraded to Neutral from Overweight at JPMorgan after yesterday's purchase...

CreXus (CXS) is downgraded to Neutral from Overweight at JPMorgan after yesterday's purchase offer from Annaly took the stock above book value and nearly to the level of the acquisition price. If CreXus shareholders haven't sold yet, they may want to think about it as pretty much only bad things can happen to the stock price from here.

Comments (3)
  • david8ricardo
    , contributor
    Comments (25) | Send Message
    "only bad things can happen" ... i'd say the exact opposite. NLY isn't going to pay less, may be forced to pay more, and you get a solid dividend for waiting. i'm holding for now
    13 Nov 2012, 08:13 AM Reply Like
  • creditlegend
    , contributor
    Comments (10) | Send Message
    I agree with David8. An offer to purchase is usually firm, although I have seen acquisition firms back out on an offer, if the purchase/offer language allows such an action. Whoever wrote this dismaying comment needs to clarify such possibilityes for investors. The article is just a "notice", without any completeness for evaluations by investors such as David8 and myself. Who can clarify whether NLY may be able to withdraw, thus creating urgency to sell shares of CXS at once?
    13 Nov 2012, 12:08 PM Reply Like
  • david8ricardo
    , contributor
    Comments (25) | Send Message
    the other thing to remember is that NLY is the largest shareholder and very involved in CXS ... there will be no "surprises" that derail their valuation. the only possibility is if the CXS independent director committee sets a value that NLY considers so outrageously high that they walk away, but these guys all know each other and understand the business well so i just don't see that as likely. we might get a dime or quarter more but i think the deal will just close at the current bid plus dividends in the interim ... a safe haven with a high yield for now
    14 Nov 2012, 08:51 AM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs