Smart Money: 15 Takeover Rumors Seeing Institutional Buying


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An eternal optimist, Liu-Yue built two social enterprises to help make the world a better place. Liu-Yue co-founded Oxstones Investment Club a searchable content platform and business tools for knowledge sharing and financial education. also provides investors with direct access to U.S. commercial real estate opportunities and other alternative investments. In addition, Liu-Yue also co-founded Cute Brands a cause-oriented character brand management and brand licensing company that creates social awareness on global issues and societal challenges through character creations. Prior to his entrepreneurial endeavors, Liu-Yue worked as an Executive Associate at M&T Bank in the Structured Real Estate Finance Group where he worked with senior management on multiple bank-wide risk management projects. He also had a dual role as a commercial banker advising UHNWIs and family offices on investments, credit, and banking needs while focused on residential CRE, infrastructure development, and affordable housing projects. Prior to M&T, he held a number of positions in Latin American equities and bonds investment groups at SBC Warburg Dillon Read (Swiss Bank), OFFITBANK (the wealth management division of Wachovia Bank), and in small cap equities at Steinberg Priest Capital Management (family office). Liu-Yue has an MBA specializing in investment management and strategy from Georgetown University and a Bachelor of Science in Finance and Marketing from Stern School of Business at NYU. He also completed graduate studies in international management at the University of Oxford, Trinity College.

By Eben Esterhuizen and Alicia Sellitti, Kapitall, Motley Fool,

When investors are looking for larger-than-average returns, they often try to sniff out the companies that seem ripe for a takeover. For while acquisitions targets aren’t always easy to locate, they can generate big profits if you’re savvy enough to spot them.

Here’s why: In order for one company to buy out another, all shareholders must be on board with the merger. So when acquirers put a bid on the company to-be-acquired, they offer a premium for its stock, essentially sweetening the deal in order to incentivize approval.

So how can you tell which companies are wearing bulls-eyes on their backs? It’s impossible to say for certain, but we came up with a way to try and find out.

First, we got the word on the Street, reading Barron’s, Wall Street Journal, Morningstar, Marketwatch,, StreetInsider, and other publications to see which takeover targets they were promoting.

This created a universe of about 250 companies. Then, we wanted to know which rumors were being taken seriously — so we tried to find the takeover rumors that are seeing institutional buying (i.e., hedge funds, pension funds, big money managers etc.).

Institutional investors manage billions of dollars worth of holdings, so you can be pretty certain that before they buy, they’re going to do some pretty thorough research.

After crunching the numbers, we came up with the following list. These rumored takeover targets have seen significant institutional inflows over the last three months, suggesting that the smart money thinks there may be some truth to the gossip — do you?

Company Source of Takeover Speculation Institutional Transactions
The LGL Group (NYSE: LGL) community Institutional investors own 783,161 shares vs. 479,922 shares held three months ago (+63.19% change)
Webster Financial (NYSE: WBS) Dick Bove, banking analyst Institutional investors own 66,830,016 shares vs. 59,361,252 shares held three months ago (+12.58% change)
Seagate Technology (NYSE: STX) Street Insider, Barrons Institutional investors own 421,348,680 shares vs. 380,902,147 shares held three months ago (+10.62% change)
Pre-Paid Legal Services (NYSE: PPD) Street Insider Institutional investors own 7,899,856 shares vs. 7,167,440 shares held three months ago (+10.22% change)
CBOE Holdings (Nasdaq: CBOE) Street Insider, UBS Institutional investors own 12,422,690 shares vs. 11,396,931 shares held three months ago (+9.% change)
Rare Element Resources (NYSE: REE) Benzinga Institutional investors own 818,906 shares vs. 755,798 shares held three months ago (+8.35% change)
Exelixis (Nasdaq: EXEL) Morningstar Institutional investors own 72,393,727 shares vs. 67,797,596 shares held three months ago (+6.78% change)
The Children’s Place Retail Stores (Nasdaq: PLCE) TheStreet Institutional investors own 31,995,519 shares vs. 29,968,904 shares held three months ago (+6.76% change)
NetApp (Nasdaq: NTAP) Street Insider, UBS, Marketwatch Institutional investors own 380,230,346 shares vs. 356,917,905 shares held three months ago (+6.53% change)
United Rentals (NYSE: URI) The Globe and Mail Institutional investors own 64,012,099 shares vs. 60,458,740 shares held three months ago (+5.88% change)
Xyratex (Nasdaq: XRTX) Barrons Institutional investors own 24,134,161 shares vs. 23,098,922 shares held three months ago (+4.48% change)
Novell (Nasdaq: NOVL) Street Insider Institutional investors own 288,343,852 shares vs. 277,863,698 shares held three months ago (+3.77% change)
Blue Nile (Nasdaq: NILE) Business Insider Institutional investors own 20,144,959 shares vs. 19,456,543 shares held three months ago (+3.54% change)
Walter Energy (NYSE: WLT) UBS Institutional investors own 51,957,272 shares vs. 50,360,160 shares held three months ago (+3.17% change)

Institutional data sourced from Reuters. The list has been sorted by the change in institutional ownership over the last three months.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top 9 stocks mentioned above. Analyst ratings sourced from Zacks Investment Research. Note: The numbers on top of items represent the forward P/E ratio, if available.

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