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 Cablevision Systems Corporation (UNKNOWN:CVC.DL) were up 19% as of 12:20 p.m. Wednesday after Charter Communications reaffirmed its decision to acquire Bright House Networks for $10.4 billion, fueling speculation of further consolidation in the space.
So what: To be sure, earlier this month at a cable convention, Cablevision CEO Jim Dolan noted he would be open to making a similar deal to be acquired by Time Warner Cable or "any other [cable] operator." "Consolidation of that marketplace would fuel ingenuity, provide much more access to resources for the customers, and lower prices," Dolan explained, "and I think would be a great business."
Now what: It's definitely a possibility, as Cablevision's relatively small $6.5 billion market cap puts it within reach of a number of potential suitors. But at the same time, such deals are hardly guaranteed. And Cablevision shareholders should be careful not to hold a potential acquisition at the core of their investment thesis. As a result, and if I were a Cablevision shareholder, I would have no problem taking at least some of today's quick profits off the table.