Seeking Alpha

This morning's spike in shares of Westport Innovations (WPRT +7.6%) on takeover speculation...

This morning's spike in shares of Westport Innovations (WPRT +7.6%) on takeover speculation gains momentum into the close. Chatter centers around potential interest from Cummins (CMI +0.3%), already involved in a JV that accounts for much of WPRT's medium-term profits.
Comments (17)
  • Westport has a broader line of nat gas engines than does Cummins and has close ties with several OEMs. They are already joined at the hip and Cummins can easily afford to make it 100 percent, benefiting shareholders of both companies.
    15 Feb 2013, 04:10 PM Reply Like
  • I am long on WPRT and would not like to see a takeover. WPRT has the ability to hit $100 a share on its own and no takeover offer is likely to show that return.
    15 Feb 2013, 04:38 PM Reply Like
  • Dream on, stanmar.
    15 Feb 2013, 08:40 PM Reply Like
  • I have been a buyer of WPRT from the low teens. Sold 50% at $49.50 and started buying back from $31 down to $22. It is by far the largest holding in my portfolio and if it breaks through the $31.60 barrier I will probably buy more.
    15 Feb 2013, 04:43 PM Reply Like
  • I'm in.
    15 Feb 2013, 05:53 PM Reply Like
  • So where are these "rumors" coming from. Anyone know? I'm not buyin anything to speculate on without some idea of the source. Any idiot can get on an investing site and start a rumor.
    15 Feb 2013, 06:23 PM Reply Like
  • If you look at the February call option activity, its easy to see why there was a bump in the stock --- lots of people into the CYA mode.
    15 Feb 2013, 08:46 PM Reply Like
  • Will have a look now for abnormally call activity, but call activity isn't a rumor, but it is an indicator. Does anyone have a source for the "rumor"? Thanks for the heads-up!
    16 Feb 2013, 11:26 AM Reply Like
  • If you want at least one source of the rumor, take a look at this page:

     

    http://bit.ly/11OzJs2

     

    To get the message, you must subscribe to "theflyonthewall", but you can get a 30 day free trial.

     

    Be careful of the "pump and dump"!
    17 Feb 2013, 10:44 AM Reply Like
  • Westport will have to be sold because it simply does not have the critical mass financially to grow. Cummins is the likely acquirer but it won't overpay because Westport is already overly dependent on them. Just as likely, Westport will issue stock to get by and current shareholders will suffer substantial dilution.
    16 Feb 2013, 07:04 AM Reply Like
  • Westport is also dependent on Volvo, Ford, GM, Tata, Caterpillar, etc.

     

    I am sure they will stand by and let Cummins take out Westport. By having Cummins control the leading nat gas engine technology, all of the above will be in a better position to generate profits by...
    25 Feb 2013, 03:45 AM Reply Like
  • Pinto Money,
    You make NO sense!
    25 Feb 2013, 10:52 AM Reply Like
  • I think I generally agree with Stanmar but if the trucking industry changeover to LNG starts picking up steam, I think his estimated price of $100 a share may be a little low.
    16 Feb 2013, 07:38 AM Reply Like
  • To Rooter28, Stanmar, & others,

     

    You folks are living in a dream world. If you follow the WPRT thread on Yahoo Finance, you will find this comment:

     

    "According to JPMorgan, Westport Innovations shares rallied on Friday resulting from a report that Cummins (NYSE:CMI) is considering an acquisition of the company at $42 per share. The firm believes that the potential deal is highly unlikely and adds that the $42 per share price makes little sense."

     

    Say "highly unlikely" and "makes little sense." Think JPMorgan knows what they are talking about? Not a rumor but a realistic assessment.
    19 Feb 2013, 04:06 PM Reply Like
  • I doubt if there is any such "rumour" as such. A takeover by CMI
    would be very logical. Look at it realistically, if the NG dream comes
    true, do you really think all the big boys out there will let WPRT eat their lunch? of course not. At present, CMI is the most logical buyer,
    but this could change if NG started to catch on in the automobile sector.
    For me, WPRT getting taken out, is not a question of if but when.
    16 Feb 2013, 08:41 AM Reply Like
  • I like the stock, but very volatile - short term risks: earnings, stock market correction or rumor is false. I would use the volatility to either sell puts to enter at a better level, or cover some of my position with calls just in case.
    16 Feb 2013, 08:26 PM Reply Like
  • The Westport-Cummins partnership is introducing the first CNG/LNG engines capable of class 8 linehaul applications. This is also without any form of aftertreatment system necessary. This will revolutionize the trucking business which affects all of us as consumers at the bottom line price of any product we buy. It is predicted that by year 2017 35- percent of class 8 tractors will run natural gas. These type of numbers are not to be taken lightly. That is a huge change in a very short time frame and Westport Innovations is at the forefront of this technology. Whoever owns them will be poised to take the profits.
    17 Feb 2013, 04:14 AM Reply Like
DJIA (DIA) S&P 500 (SPY)