Jefferies Group Shares Jumped: What You Need to Know

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 Jefferies Group (NYSE: JEF  ) rose as much as 10.5% in early trading and maintained much of that gain through to the closing bell. Rising prices for its corporate bonds suggest that fears Jefferies could be next after MF Global (OTC: MFGLQ.PK) to face bankruptcy are unwarranted.

So what: According to Bloomberg, Jefferies’ April 2021 notes rallied for a fourth straight day as investors drew distinctions between the firm and MF Global, a futures operator sunk by a multibillion-dollar bet on distressed European bonds.

Now what: The added confidence seems to be the result of repeated efforts to reassure shareholders. Most recently, the company said its own bets on European debt are net short $134 million, Bloomberg said. Deteriorating conditions on the Continent would therefore result in profits rather than the sorts of losses that sent MF Global into liquidation. Is that enough to get you to buy shares of Jefferies Group at current prices? Please weigh in using the comments box below.

Interested in more information about Jefferies Group? Add it to your watchlist.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn’t own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

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Read/Post Comments (3) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 03, 2011, at 8:11 AM, clo7clo7 wrote:

    Shocked! I was absolutely shocked when Wachovia Corp., one of the largest banks in the US, thought to be well managed and solid, practically went under and got hurriedly merged (as in a shotgun marriage) into Wells Fargo. One never knows about these financial firms, so there is always a risk.

    Just the same, JEF may have been unfairly maligned, and it might offer a wonderful opportunity to buy at the bottom. I wouldn't knock it. I am sure its management is sincere in defending the company. The Wachovia folks looked sincere too, and that's the problem for those of us who remember the past.

  • Report this Comment On December 05, 2011, at 4:47 AM, chucky46 wrote:

    i bought shares of jef. right after the market took it to the whipping post. thought i got it low until it went lower. now after this week it rebounded to where i`m slightly in the green. what should i do ?????????????????????????

  • Report this Comment On December 05, 2011, at 10:07 AM, TMFMileHigh wrote:

    @chucky46,

    >>what should i do?????????????????????????

    Thanks for writing but I can't give you specific buy and sell advice.

    My take would be to evaluate why you bought in the first place and only decide after you've fully considered what you judge to be fair value for the business.

    Foolish best,

    Tim (TMFMileHigh and @milehighfool on Twitter)

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