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.
So what: According to a person familiar with the matter, Crocs has had talks with a few private equity firms, including Blackstone Group and KKR, triggering speculation that the shares might be undervalued. The same source, however, also said that the chances of a deal are slim because of differences over the purchase price, suggesting that Crocs' management may instead look into a stake sale or joint venture to unlock shareholder value.
Now what: I'd be cautious about buying into the M&A buzz. The downside is just too big if Crocs' management team -- which already has credibility issues -- ends up doing nothing, while it seems that Wall Street has already baked in much of the upside. So unless you'd be perfectly willing to own Crocs (and its declining sales trend) as a stand-alone investment, it's probably best to watch the process unfold from a distance.