Timberland Shares Skyrocketed: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of rugged-boot specialist Timberland (NYSE: TBL  ) soared a staggering 42% after apparel maker V.F. Corp. (NYSE: VFC  ) agreed to acquire it for about $1.8 billion.

So what: The all-cash deal values Timberland at $43 per share and represents a whopping 43% premium to its closing price on Friday. V.F. is primarily making the move to boost its outdoor gear sales internationally, and judging by the stock's 11% pop today, Mr. Market seems very pleased with the strategy and purchase price.

Now what: While Timberland's upside is now limited, V.F. might be a long-term opportunity worth looking at. V.F.'s outdoor and sports segments will now account for more than 50% of its business, with management expected to add about $700 million to its top line and $0.25 in per-share earnings in 2011. Of course, for more enterprising Fools who'd rather find the next buyout winner, gains in footwear stocks such as Crocs (Nasdaq: CROX  ) and Finish Line (Nasdaq: FINL  ) suggest there could be plenty of more action in the space.

Interested in more info on Timberland? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Timberland and owns shares of it. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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Related Tickers

12/31/1969 7:00 PM
TBL.DL $0.00 Down +0.00 +0.00%
The Timberland Co. CAPS Rating: ***
CROX $8.06 Down -0.09 -1.10%
Crocs CAPS Rating: **
FINL $20.78 Down -0.32 -1.52%
The Finish Line CAPS Rating: **
VFC $54.30 Down -0.32 -0.59%
VF CAPS Rating: *****