Why TriQuint Semiconductor Shares Skyrocketed

Is TriQuint's jump meaningful? Or just another movement?

Feb 24, 2014 at 8:55PM

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 TriQuint Semiconductor (NASDAQ:TQNT) jumped more than 26% Monday after the company announced it would merge with RF Micro Devices (NASDAQ:RFMD).

So what: The all-stock transaction, which today's press release describes as a "merger of equals," has already been approved by both companies' boards of directors, and is expected to close in the second half of calendar 2014.

The transaction is also intended to be a tax-free reorganization, and implies a price of $9.73 per TriQuint share. Triquint shareholders will receive 1.675 shares of the new company for each share of Triquint they own, which will collectively result in 50% ownership of the combined company when the transaction is complete.

Now what: Curiously enough, shares of TriQuint closed today at $11.64, or a nearly 20% premium to the merger's implied valuation. However, that seems an optimistic reflection for the post-merger prospects of the combination, which is expected to achieve at least $150 million in cost synergies after the first two years. What's more, the transaction should not only help the two companies better compete with larger competitors like Qualcomm, but is also expected to be accretive to adjusted earnings per share in the first full fiscal year following its close.

All things considered, while I definitely wouldn't buy now, it would be hard to blame Triquint shareholders for hanging onto at least some of their shares after today's pop.

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Steve Symington has no position in any stocks mentioned. The Motley Fool owns shares of TriQuint Semiconductor. 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 Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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