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 specialty insurer Global Indemnity
So what: According to Global, one of those strategic options includes "discussions with potential acquirers," so it's no surprise that Mr. Market is bidding up the shares in anticipation of a buyout. Global has done well to navigate a difficult pricing environment over the past few years, but with its shares consistently trading well under book value (even with today's pop), management seems to be taking a more active approach in "unlocking" shareholder value.
Now what: I'd be careful about buying into the buyout buzz. In today's press release, Global made sure to note that "there can be no assurance that this process will lead to a transaction," so betting on the stock based purely on takeover-talk seems risky. Unless you'd be perfectly willing to own Global as a long-term standalone investment, it's probably best to watch the process unfold from a distance.
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