A Tidal Wave of Takeovers is Coming in 2021

You're receiving this email as part of your subscription to Trend Trader Daily. [Unsubscribe here](. A Tidal Wave of Takeovers is Coming in 2021 By Lou Basenese Thursday, April 29, 2021 Like most things in 2020, the onset of the pandemic slammed the breaks on mergers and acquisitions (M&A) activity. In fact, the second quarter of 2020 was one of the slowest in six years. Case in point: The average number of takeovers announced globally each month plummeted 30% to 236, according to Refinitiv data. But as you’ll see in a moment, the slowdown didn’t last long and I’m predicting 2021 will be a record year for M&A activity. If you’ve ever owned shares of a company on the receiving end of a takeover offer, you understand what that means for us as investors. When a deal is announced (or even rumored) prices skyrocket by double- or even triple-digits in a single day. Newsflash: That’s a trend we don’t want to miss out on. So let me explain what’s going on and more importantly, how we’re going to take advantage of it. Call It a Comeback! After a slow second quarter, global M&A activity came back with a vengeance. So much so, the annual deal volume checked-in above $3 trillion for the seventh consecutive year. click image to enlarge) As we exited 2020, the pace of takeover deals accelerated even more with a record 1,250 deals announced in the fourth quarter alone. And everyone was shocked… As Brian Healy and Tom Miles, Co-Heads of Americas M&A, said: “No one expected the pandemic, of course, but I don’t think we expected that the M&A market wouldn’t just recover, but actually go into overdrive with activity by the end of the year, far beyond the historical norm.” Well, guess what, Brian? We haven’t seen anything yet! I’m convinced the current boom in takeovers is about to catapult to new heights. How can I be so sure? Easy. Numbers Don’t Lie Consider: - 53% of U.S. executives said their companies plan to increase M&A investment in 2021 in a recent PwC survey. - They have the ammo to do it, too, as there is a record amount of cash sitting on the balance sheets of publicly traded companies. A staggering $2.5 trillion to be exact. - Not only is there record levels of cash sitting on corporate balance sheets begging to be deployed, but private equity shops are flush with dry powder, too. A staggering $1.9 trillion, based on the latest tally S&P Global Market Intelligence. - Tack on historically low interest rates and all that cash can be levered to buy even more. Here’s the key – while companies can theoretically sit on their cash indefinitely, private equity funds can’t. Investors pay them to deploy it. Stat! So it’s only a matter of time before at least a $2.5 trillion tidal wave of cash gets put to work to scoop up shares of publicly traded companies. Putting Theory into Practice The evidence speaks for itself. We’re in the midst of one of the most robust merger and acquisition cycles ever. All we have to do is make sure we own shares of a handful of these target companies, and we’re destined to enjoy lightning-fast, triple-digit profits. I’m sure you’re wondering – how do we even begin sifting through literally thousands of publicly traded companies to uncover the one or two with the best chances of being bought out? Understandably, it’s a daunting task. But it’s not impossible. The simplest solution is to focus on sectors that are already consolidating, where deals are already being announced. With that in mind, I’m going to share the three most active sectors for M&A activity tomorrow. For now, it’s important to understand that consolidation trends in a sector tend to persist. By that I mean, a “domino effect” often kicks in after a few mergers are announced in the same sector. You see, each deal changes the competitive landscape and forces other industry players to pursue a takeover of their own just to stay competitive. The more deals that get done, the greater the pressure gets for other competitors to find a target. And the cycle continues. Of course, each deal that gets done reduces the number of available targets and therefore makes the process of identifying the remaining targets in a sector much easier for us. At that point, all we have to do is screen for the companies in the sector with the strongest fundamentals (like high growth, high profits), and we’ll be well on our way to identifying the market’s next takeover targets. Of course, if you really want to increase your probabilities of holding the market’s next hot takeover stock, there’s more analysis involved. The good news? I’m willing to do it for you. In fact, I just launched a brand-new research project designed to find the market’s next takeover targets. You can find out all the details [here](. Ahead of the tape, [Lou Basenese] Lou Basenese [Terms & Privacy](| [Unsubscribe]( 301 S. Perimeter Park Dr. Suite 100 Nashville, Tennessee 37211 RISK NOTICE: All investing comes with risk. That includes the investments teased in this letter. You should never invest more than you can afford to lose. Please use this research for the purpose that it's intended — as research only. You should consult a professional financial advisor before ever taking a position in any securities you see herein. SECURITY HOLDING NOTICE: Although we are never compensated from any companies for coverage, you should be aware that Trend Trader Daily, its authors, its owners, and its employees may purchase, sell, or hold long or short positions in securities of the companies mentioned in this communication. While authors might actively transact in the securities mentioned, they will always have a net position that is consistent with the position set forth in our research reports, letters and updates. DISCLAIMERS: The work included in this communication is based on diverse sources including SEC filings, current events, interviews, corporate press releases, and information published on funding platforms, but the views we express and the conclusions we reach are our own. As such, this content may contain errors, and any investments described in this content should be made only after reviewing the filings and/or financial statements of the company, and only after consulting with your investment advisor. Actual results may differ significantly from the results described herein. Furthermore, nothing published by Trend Trader Daily, Inc should be considered personalized financial advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice. Trend Trader Daily is an independent provider of education, information and research on publicly traded companies, and as such, it accepts no direct or indirect compensation from any companies or third parties mentioned in any of our letters, reports or updates. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -