Special Situation Ideas For The Week Of August 6, 2017

Includes: CSTM, TGNA
by: Kedar Special Situations

Those looking into some catalyst might want to ponder over these names for the week. I have done research on few of them, the other I have read online on Barron's and other publications.

Constellium (CSTM): It is a Netherlands-based company engaged in developing aluminum products for a range of markets and applications, including aerospace, automotive and packaging. The company IPO'ed back in 2013 at $15 share, before rising to an all-time high of $34/$35. Since then, due to operational issues, financial mismanagement and poor leadership, the stock suffered and traded under $5 per share. To add to the woes was a poor aerospace market. However, recently, CSTM got a new management, which oversaw operational turnaround. The new management team is helped by improving aerospace, auto and can market.

The stock, according to Bloomberg, had some recent takeover interest. From what I have known with my own research, the management was not very keen to sell at this price. Longer term, the company has a bright future and I can easily see this stock double from here if held for medium to long time. This stock was part of my portfolio when it was trading at $5 a share. I would advise this company should be seriously looked into.

Tegna (TGNA): Tegna Inc. has a portfolio of media and digital businesses that provide content. The company recently spun off its cars.com segment, and also divested its stake in Careerbuilder, the job hiring portal. What remains with the company is a host of TV stations in important states in the US. With the changing political landscape, especially with the recent election of Mr. Trump, we can only expect increased political spending which will benefit the company. 2018 should start off stronger with the benefit of both the Super Bowl and Winter Olympics at their core NBC stations and could bring the benefits of local consolidation and a stronger-than-expected political year.

Additionally, with a pure play within the content transmission and media sector, the company can easily become a takeover target for a larger firm looking to expand via acquisitions.

Disclosure: None.