Why Bio-Rad Shares Popped

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 life science diagnostic and research equipment expert Bio-Rad Laboratories (NYSE: BIO  ) were surging today, gaining as much as 15% in intraday trading.

So what: It appears that Bio-Rad's stock is climbing on sad news. It was announced late yesterday that David Schwartz, the company's 88-year-old co-founder and chairman, passed away over the weekend.

While a headline at MarketWatch reads "Bio-Rad jumps 12% on Luminex deal," the extension of a sales and distribution agreement with longtime partner Luminex (Nasdaq: LMNX  ) doesn't seem like much of a reason for Bio-Rad's stock to go bananas. Bloomberg, meanwhile, noted that there's been a long-held belief that the company -- which is owned in large part by the Schwartz family -- could end up on the selling block after the death of its founder. That seems like a much more likely driver for today's action, as investors often rush to a potential buyout candidate in expectation that a buyer will pay a takeover premium.

Now what: In the hefty book of inadvisable investor moves, one of my least favorites is chasing merger and acquisition rumors. I'm sure the strategy works out on occasion. However, trying to get rich on rumor and speculation is more likely a great way to ruin your retirement -- or whatever else your investment portfolio is aimed at. In this Fool's opinion, chasing Bio-Rad's run today is about as wise as "investing" in lotto tickets.

Want to keep up to date on Bio-Rad Laboratories? Add it to your Watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer has nofinancial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.


Read/Post Comments (0) | Recommend This Article (0)

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.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1854534, ~/Articles/ArticleHandler.aspx, 11/29/2014 3:54:04 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement