Why Riverbed Technology, Inc. Popped Today

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 Riverbed Technology, (NASDAQ: RVBD  ) popped 11% today after activist hedge fund Elliott Management Corp. offered to buy the networking gear maker for about $3.1 billion.

So what: The all-cash offer values Riverbed at $19 per share and represents a premium of 6% to yesterday's close price. Elliott -- which already owns a 10.5% stake in the company -- is making the move as it clearly sees Riverbed as undervalued, but with the stock already trading above its $19 offering price, Mr. Market is betting that this is just the first step in the value-boosting process.

Now what: Expect Elliott's offer to prompt higher bids in the near future. "To this point, we believe other strategic and financial buyers could enter the Riverbed bidding process over the coming months as this remains a core strategic asset within the broader technology food chain," FBR Capital analyst Daniel Ives wrote in a note to clients. Of course, unless you'd be perfectly willing to own Riverbed as a long-term investment, it's probably best to watch the process unfold from the sidelines.

More reliable ways to build wealth
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.


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: 2788017, ~/Articles/ArticleHandler.aspx, 10/23/2014 12:55:26 PM

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...

Apple's next smart device (warning, it may shock you

Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early-in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!


Advertisement