Monday, April 01, 2019

March 2019 Performance

The strength of this market continues to amaze me. The market just takes bad news in stride and just climb a wall of worry. I really did nothing for March other than dabble with a small special situation trade with Eli Lilly’s (Ticker: LLY) spin off of Elanco (Ticker: ELAN). The portfolio was able to generate a positive gain of 5.06% for the month.

In the merger arb space, I’m still playing Sparks Therapeutics (Ticker: ONCE) via Short Puts and looking for a resolution this week. If all goes well with the antitrust review, this tender offer could possibly close this week. I still cannot see any antitrust issues with Roche’s (Ticker: RHHBY) acquisition of Sparks Therapeutics.

The other big news this week is Constellation Brands (Ticker: STZ) earnings release on Thursday. The stock sold off on the last earnings report due to weakness in the low end wine segment. Maybe they will announce the divestiture of their low end wine portfolio with this earnings report. I continue to like this company based on the anticipated free cash flow.

That’s all I have to report…

2019 Performance = +17.00% with the running monthly returns as follows:

January +7.4%
February +3.7%
March +5.06%

15 Comments:

At April 03, 2019, Anonymous Anonymous said...

ONCE: tender offer extended May 2. Seems like only 29% shares tendered. Does the short put premiums blow up now?

 
At April 03, 2019, Anonymous mergerpie said...

refile HSR... any foreseen problems with the merger or just that govt needs more time... Sangamo just released positive results for its ph i/ii for hemo A gene therapy

 
At April 03, 2019, Anonymous Anonymous said...

ONCE: if they received HSR approval today, they could have just extended the tender offer to a week. I don’t understand the rationale of refilling again. Anyone has more input on today’s withdrawal and refiling?

 
At April 03, 2019, Blogger Money Turtle said...

Obviously more questions from the regulators. People will only tender after receiving HSR approval.

 
At April 03, 2019, Anonymous Anonymous said...

Are you holding ONCE till May now?

 
At April 03, 2019, Blogger Money Turtle said...

I closed out my position (short Puts) today. I was anticipating antitrust approval today and that did not occur. There is something the regulators find concerning. All in all, I still ended up with a small gain.

 
At April 04, 2019, Anonymous Anonymous said...

STZ: thanks MT for the high conviction buy

 
At April 04, 2019, Blogger Money Turtle said...

STZ: There's more gains ahead with their Mexican beer portfolio (it's not only the Corona family). Brands like Modelo and Pacifico are gaining strong momentum. And of course, you have the wild card with the Canopy investment. This is one of my core holdings and currently makes up ~ 25% of my portfolio.

 
At April 13, 2019, Anonymous Anonymous said...

ONCE: anyone knows what’s the problem with this. They were supposed to refile by apr 10. They will have to extend the tender offer again.

 
At April 13, 2019, Blogger Money Turtle said...

ONCE: I've heard that a report came out from The Capitol Forum, which caused ONCE to sell off. Roche did state that they planned to refile on or about April 10th, which I assume has occurred. Now it's another waiting game..

 
At April 23, 2019, Anonymous Anonymous said...

ONCE: if they refiled wouldn’t they have to make it public? I don’t see any new filing on the SEC site

 
At April 23, 2019, Blogger Money Turtle said...

ONCE: The company has already stated that they plan to refile on about April 10th. That's sufficient disclosure.

 
At April 28, 2019, Blogger Money Turtle said...

From CTFN: "Market observers estimate Roche will have 50% of the hemophilia A with inhibitor market by 2023, around the time SPK-8016 could be approved if it does not encounter issues. Antitrust professionals CTFN spoke with believe the FTC could have flagged this as an issue."

I think this it is a stretch for the FTC to be looking at potential market share ~ 5 years out. Lots can happen over that time. I want to get back into ONCE, but the FTC is definitely not making this easy. I initially thought there would be no antitrust issues, but obviously not the case now.

 
At April 29, 2019, Anonymous Anonymous said...

Thanks for the update.

 
At December 12, 2019, Blogger New Trades Career said...

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