Kansas City Southern (STAR)
“I’ll see your US$25.2-billion and raise you US$4.7-billion.” In a poker game that puts the puny stakes in Las Vegas to shame, Canadian National Railway Co. tabled a US$29.9-billion or US$325-a-share offer for U.S.-based Kansas City Southern, topping an earlier bid from rival Canadian Pacific Railway Ltd. Judging by the subsequent skid in CN’s share price, CN shareholders aren’t thrilled with the hefty price being offered. But you won’t hear any complaints from shareholders of Kansas City Southern, whose stock has been chugging to record highs even as CP’s chief executive said he had no plans to get sucked into a bidding war.
Purpose Bitcoin ETF (DOG)
No digital wallet? No problem. Thanks to bitcoin exchange-traded funds, it’s never been easier to lose money on cryptocurrencies. After hitting a record high of more than US$64,000 on April 14 – propelled by excitement surrounding the Nasdaq listing of crypto trading platform Coinbase – bitcoin’s price plunged to less than US$50,000 as of Friday afternoon. And it could go lower still: Citing the “steep liquidation” of positions, strategists at JPMorgan Chase predicted that bitcoin’s “momentum signals will naturally decay from here for several months.” Time for someone to invent an inverse bitcoin ETF. Wait. Someone already did.
Intuitive Surgical (STAR)
“The robot will see you now.” In the old days, surgeries were always done by hand with a scalpel – which could be a problem if your doctor had a triple espresso at breakfast. But thanks to Intuitive Surgical Inc.’s robotic-assisted systems, surgeons can perform minimally invasive procedures using tiny instruments guided by a console. The shares jumped after the company posted first-quarter revenue and earnings that easily beat expectations, lifted by a 16-per-cent increase in procedures using Intuitive’s da Vinci surgical system. With the stock hitting a record high this week, investors are feeling no pain.
Knoll (STAR)
With offices closed during the pandemic and employees working remotely, this might seem like a lousy time to make a big bet on office furniture. But Herman Miller Inc. evidently disagrees: The company – which makes furniture for offices, hospitals, homes and outdoor settings – agreed to pay about US$1.8-billion or US$25.06 a share in a cash-and-stock deal to acquire rival furniture maker Knoll Inc., aiming to capitalize on the growing work-from-home market. Come to think of it, these milk crates I’ve been sitting on for the past 12 months are starting to hurt my back.
Netflix (DOG)
Most people can’t wait for the pandemic to end. But Netflix Inc. shareholders might have some mixed feelings. With consumers emerging from lockdowns in the United States just as competition is heating up from myriad other streaming services, Netflix added just 3.98 million subscribers in the first three months of 2021 – far fewer than the 6.25 million analysts had expected. Worse, growth will likely slow even further in the second quarter when Netflix expects to add just one million subscribers. The silver lining is that the easing of restrictions will allow Netflix to produce more content. But will people pay to watch it?
A humorous look at the companies that caught our eye, for better or worse, this week
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John Heinzl