Yet Another Stock Opportunity- $175-200 Profit

[Recyclersteve]

A quick little tease- I will be publishing another article on SeekingAlpha.com about a low risk/high reward trade very soon- it is in for review now and will be published either Friday or Monday. It should be a very good opportunity to make around $175-200+ on a stock and get your money back in about 5 weeks. Why would I do this without charging for it? I hope to eventually get enough of a following where I can SELL annual memberships for the service.

My first article published there on Fortive (FTV) has over 1,900 page views in just 1 1/2 days, so I am off to a good start. Thanks to anyone here who looked at the article.

Keep watching this thread for updates over the next several business days.

[Recyclersteve]

Ok, here is the Cliff Notes version of the deal. The stock is Blue Bird Corp. (Ticker: BLBD). You may not recognize the name, but they are the manufacturer of those famous yellow school buses used in about 60 countries worldwide. They have been in business since 1927 (way longer than I've been in business if you know what I mean).

If you buy up to 99 shares per tax ID and validly tender all of them with your broker (don't keep a few behind for sentimental reasons), then you have a very solid chance that all shares will be taken and you will receive $28 a share for them. The stock closed today at $25.35, so a buy at that price yields a potential profit of $2.65 per share minus commission/potential Reorg. fee. Households with brokerage accounts in multiple names can EACH buy 99 shares. Example: Mom and dad each have accounts, as well as there being brokerage accounts for the kids such as custodial type accounts.

Keep in mind that you need to have a brokerage account where you can buy common stock as opposed to a company retirement account or 401(k) where you likely cannot.

See my article on SeekingAlpha.com titled "Time To Consider Riding The Blue Bird Bus: Tender Offer To Consider Now". These deals are very sporadic. Other than the FTV one that is just ending, it has been since last November since I saw a really good one- CBS.
If you want to consider dipping your toes in the water and getting experience in the exciting world of corporate actions, I don't know of a simpler way that by trading BLBD. Still not an absolute guarantee you will make money. Read my full article and the first two comments after the article for further details before participating. Good luck to all.

[highroller4321]

When is the tender deadline on this?

[Recyclersteve]

It is all detailed on the SeekingAlpha.com site. That said, there are two deadlines. The official one (10/15) and your broker's deadline. My broker's deadline is 10/11. Your broker's deadline is the important one and you might need to tender settled shares, so you should buy at least 2 business days before the deadline and perhaps 3. Contact your broker for more specifics.

[Recyclersteve]

I need to add another thing that should be studied a bit before taking action. There is a possibility (slim as it might be) that there could be more shares tendered by odd lot holders than there will be bought. If that happened, then even the odd lot holders would be prorated. I'm not worried about that at all as the average percentage of shares tendered by odd lot holders was only 4.34% in the corporate actions that I studied.

That said, I've gotten some responses (on the public SA site and directly to me in the form of private messages) from haters who feel that I should keep my mouth shut on these deals and that I am potentially ruining this for everyone. They are basically saying that they feel we are going to have things change where EVERYONE WILL BE PRORATED, even those with 99 or fewer shares.

We can debate that back and forth forever. I stand by the 4.34% figure I used- that is hardly a stampede of odd lot shareholders. Also, the idea of everyone being prorated is NOT new. I've seen it happen on many deals for about 4-5 years now.

Nonetheless, you should read the comments before buying stock in your personal account.

[Recyclersteve]

Also, I noted this in a different thread, but thought I'd add it here. Saturday night I was scouring the internet for new corporate actions to study. I went to BING (Microsoft) and typed "stock tender offer", clicked on News and filtered for the "Last 30 Days". The first item on the list was my BLBD article with my photo as well. I was absolutely floored. Companies pay millions for this type of advertising and I got it for free.

[Recyclersteve]

If you haven't yet bought BLBD stock, the terms have been changed- in a BAD WAY. Everyone will be prorated, so there is no incentive to buy 99 or fewer shares. In other words, EVERYONE WILL BE PRORATED. My guess is that if you buy and validly tender 99 shares, they will only take 15-20% of your shares, returning the other 80-85% to you. Please tread very carefully if you still want to do this. I can't wholeheartedly recommend that people do it anymore. I had never heard of this happening before publishing the article I wrote on SeekingAlpha.com. Oh well- at least my dog still loves me!

[highroller4321]

If you haven't yet bought BLBD stock, the terms have been changed- in a BAD WAY. Everyone will be prorated, so there is no incentive to buy 99 or fewer shares. In other words, EVERYONE WILL BE PRORATED. My guess is that if you buy and validly tender 99 shares, they will only take 15-20% of your shares, returning the other 80-85% to you. Please tread very carefully if you still want to do this. I can't wholeheartedly recommend that people do it anymore. I had never heard of this happening before publishing the article I wrote on SeekingAlpha.com. Oh well- at least my dog still loves me!

Any reason why they would do that?

[Recyclersteve]

I can't prove it, but I think someone pointed the article out to either an underwriter of the deal or large institutional holder and basically said "See, you're letting the little guys take advantage of you!" They made someone, who doesn't know much about these deals, feel bad. As a result they reacted emotionally and changed the terms of the deal. It is very frustrating, especially since only about 6% of the shares of the last deal represented odd lots- hardly a stampede. Oh well...

[highroller4321]

I can't prove it, but I think someone pointed the article out to either an underwriter of the deal or large institutional holder and basically said "See, you're letting the little guys take advantage of you!" They made someone, who doesn't know much about these deals, feel bad. As a result they reacted emotionally and changed the terms of the deal. It is very frustrating, especially since only about 6% of the shares of the last deal represented odd lots- hardly a stampede. Oh well...

I did see the comments on your article about how advertising these kinds of deals tends to make them go away. I didn't think the comment had any merit, but maybe it does.

[natsb88]

I did see the comments on your article about how advertising these kinds of deals tends to make them go away. I didn't think the comment had any merit, but maybe it does.

This is a fairly common occurrence with gift card / coupon / discount / arbitrage opportunities among retailers and online sellers. When the deals are discovered and shared among a relatively small closed group they tend to stay below the radar for a while and the people who put the effort into finding them reap the rewards. Once they are shared in a more public manner and many more buyers try to jump in, the retailers catch on and shut down the offer (sometimes canceling any previous pending orders too).

I think it's pretty reasonable to speculate that somebody in the company might from time-to-time Google their company name (or have Google Alerts set up) to keep up with articles and commentary about their upcoming corporate actions. Somebody in the company reading an article detailing how multiple people in the same household can each structure accounts to take maximum advantage of their offer would surely get their attention. I'd also speculate that the smaller the company, the more likely such a discovery would make its way to the decision makers and result in a policy change.

I can't prove it, but I think someone pointed the article out to either an underwriter of the deal or large institutional holder and basically said "See, you're letting the little guys take advantage of you!" They made someone, who doesn't know much about these deals, feel bad. As a result they reacted emotionally and changed the terms of the deal. It is very frustrating, especially since only about 6% of the shares of the last deal represented odd lots- hardly a stampede. Oh well...

Doesn't seem like an emotional reaction to me. Seems like a sound business decision. People found a way to exploit the odd lot clause/offer that was intended as a courtesy to existing small shareholders, so now that courtesy goes away.

[NotABigDeal]

That's what I was thinking. Shoulda kept the info here on the down low, hehe.

Deal

[Recyclersteve]

Nobody knows for sure, but there was a website (where you pay a fee) set up years ago for these deals (oddlotpecialsituations.com). Also, there was a guy with over 24,000 followers on SeekingAlpha.com (vs. my <200) who talked about 3 of them in a 5-day period in 2013. I figured that if the deals could tolerate coverage like those two and still result in only a small percent of shares tendered being odd lots (the most recent was 6%- hardly a stampede of odd lots), then the market could tolerate my coverage as well. Oh well- live and learn.