Apologies for my fundamental lack of understanding of how stocks are valued. It's a miracle that I fooled my various employers for so long.
Taking your example, the notional cap of the combined company would rise from $1bn to $2bn. But no value has been created as you have paid out $1bn in consideration. Reported EPS would however rise enormously. More than likely the PER would rises too as investors anticipate more earnings enhancing deals, so the share price gets a double boost. And the execs get a triple boost, as their SARs are linked to EPS growth! This is the magic sauce I was referring to.
Why I passed on CTD., page-78
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Last
$14.09 |
Change
0.030(0.21%) |
Mkt cap ! $1.780B | |||
| Open | High | Low | Value | Volume |
| $14.13 | $14.28 | $14.03 | $6.232M | 444.4K |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 2 | 215 | $14.05 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $14.09 | 999 | 1 |
View Market Depth
| Last trade - 16.10pm 22/11/2024 (20 minute delay) ? |
| CTD (ASX) Chart |
