Last month we talked about Jonathan Tunney’s MergerArb model here. This week, he made another change to the model by adding Playboy Enterprises Inc (NYSE: PLA), right on the heels of a buyout offer from Friend Finder Networks, Inc. the parent company of Penthouse magazine. PLA founder Hugh Hefner has also submitted a bid so that he can take the company private. Though the company posted a net loss in quarter two 2010, the potential for an acquisition could lay the foundation for an arbitrage opportunity.
Michael Simon’s Large Cap Growth model contains equities with sustainable business models that also have strong management and reliable cash flows. This week, Simon added Joy Global Inc (NASDAQ: JOYG) to the model. JOYG specializes in mining solutions and equipment. The company’s net cash flow dipped in 2009 but still exceeded 2006 and 2007’s cash flows. Their net revenues have been steadily increasing at least since 2006. In 2009, the company’s total liabilities were the same as they had been in 2008. The mining solutions offered by JOYG are diverse and cover the needs of many different industries and the company places a strong emphasis on its management strategies and ethical practices.
In his Capital Appreciation ETF model, manager Paul MacNamara takes a macroeconomic view when determining what to buy and hold long-term and uses technical analysis to hedge against market volatility in the short-term. MacNamara only buys ETFs for the model. This week he added iShares MSCI Emerging Markets Index Fund (EEM) which was developed to mirror the performance of the MSCI Emerging Markets index. While the global economy is still shaky, positive news about China’s economy may influence this ETF’s performance. At the time this post was written, EEM was trading at a premium to NAV.
