These 2 Buy-Out Stocks Hit Higher Highs

It’s unusual to see a stock head quickly higher than the announced price of a buy-out bid — but that’s what’s happened recently in 2 equities, one NYSE-listed and the other NASDAQ
NDAQ
traded. The reasons are a little different in each case but if you’d already invested in either of these, you have to happy with the results.

Turquoise Hill Resources is a copper stock that recently received a buy-out offer from a larger copper outfit, Rio Tinto, at $26.68/share. Turquoise owns the world’s largest copper/gold project, the Oyu Tolgoi mine in Mongolia. It’s a $2.7 billion bid designed to add the remaining 49% of the shares in Turquoise already owned by Rio.

A few days after the buy-out offer, the stock continued to trade higher than the $26.68 original bid. This may have been because the price of copper continued higher and so the mine is worth even more. Or it may be because other copper producers are interested and paying attention. Or it may be some combination of the 2.

Whatever the reasons, here’s the daily price chart for Turquoise Hill Resources:

You can see how the stock jumped on the news from Rio Tinto. Note the sudden increase in volume shown along the bottom of the price chart. After a few days in the 26 to 26.50 level, take a look at the blast even higher, up to above 29 before some selling finally came in.

Turquoise Hill Resources management says it’s received the Rio offer and it’s being examined.

For a different perspective, here is the point-and-figure chart for Turquoise Hill Resources:

The move above the Rio Tinto’s buy out bid near 26 is clearly evident on this chart. Note that the “P&F Pattern: Ascending Triple Top Breakout,” dated 3/14, proved to be accurate and helpful.

The other fascinating buy-out bid came for Hollysys Automation Technologies, a China tech stock that had dropped from 21 in September, 2021 to 11 by mid-December. This week, on news that a state-owned company in Beijing had expressed interest in making an offer for the company, the price Monday jumped to 15.75 on heavy volume.

Then, as it became apparent, according to this Yahoo News story, that “other suitors” may also be interested, the stock continued even higher, up to almost 17.50 before a bit of selling finally showed up.

Here’s the Hollysys Automation daily price chart:

The stock benefitted as well from the late week recovery in China stocks generally.

The Hollysys point-and-figure chart is here:

That “P&F Pattern Bullish Triangle Breakout on 15-Mar-2022” seems prescient. A close above 17.50 would break the price out of a significant downtrend line on this chart — another bullish development from a price chart analysis viewpoint, if it takes place.

Not investment advice. For educational purposes only.

For more analysis and charts, please subscribe to my website right here:

CheapbargainstocksCheap Bargain Stocks – Find The Most Undervalued Stocks On Wall Street