The latest 13F season is commencing, when many money managers issue required reports on their holdings. It can be worthwhile to pay attention, as you might get an investment idea or two by seeing what some major investors have been buying and selling.
For example, consider GAMCO Investors, (GBL 4.24%), the diversified asset manager and financial services company headed by well-known value investor Mario Gabelli. According to its recently released 13F statement, the company has sold out of its positions in Stewart Enterprises, (NASDAQ: STEI), SHFL Entertainment, (SHFL.DL), and ONYX Pharmaceuticals. All three companies are being bought out by other companies.
Stewart Enterprises was recently the second-biggest operator in the "death-care" industry, but it is being gobbled up by Service Corporation International (SCI 1.23%). The new, bigger Service Corp. will sport 15% of the national funeral market. The deal was opposed by many, but the FTC approved it with the stipulation that Service Corp. sell a few dozen funeral homes and cemeteries. In its recently released fourth quarter, Service Corp. posted revenue up 6% and net income down 2%. Its stock yields 1.7%. The death-care industry is attractive to many investors because of its dependability, as deaths are rather inevitable, with their number rising along with the population.
Casino supplier SHFL entertainment, formerly known as Shuffle Master, is being bought by Bally Technologies Inc. The deal will make Bally more of a one-stop shop for any supplies a casino might need, and it also powers a move into the promising arena of online gaming. So far several states such as New Jersey and Nevada have legalized online gaming, and there's speculation that national legalization may follow. It's likely a multi-billion-dollar market, and Bally could make a lot of money supplying the casinos that actually offer the online gaming. Still, Bally does face competition, and the future of online gaming is far from clear, though traditional bricks-and-mortar casinos will continue to drive demand for its offerings.
ONYX Pharmaceuticals has been acquired by biotech giant Amgen (AMGN 1.56%), with the deal boosting Amgen's product lineup and pipeline and expanding its presence in oncology. Amgen got Kyprolis, Onyx's multiple-myeloma drug, along with Nexavar (targeting liver and kidney cancers) and Stivarga (treating colorectal and stomach cancers), both co-owned with Bayer AG. Some expect Kyprolis to top $2 billion in sales eventually. Amgen stock yields 2% and in its fourth quarter, the company posted revenue up 13% over year-ago levels and profits up 30%.