Mega Media Merger; Fitbit is Overweight…And That’s a Good Thing; Some Foam for Thought

Urge to merge…

Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

Image courtesy of Sira Anamwong/FreeDigitalPhotos.net

While you were busy navigating mall parking lots trying to find a parking space so you could do some meaningful Labor Day shopping, Media General was also busy doing some shopping of its own. The media company picked up, or merged – as it’s being called – with Meredith Media to the tune of $2.4 billion. The new company to be borne out of this merger will be called Meredith Media General – how convenient – and will take its place as the third largest television station operator in the U.S. Media General is gaining an additional 17 television stations, bringing its grand total to 88. Meredith also brings with it some great poolside reading, including Better Homes and Gardens, Shape and Parents magazine – the ultimate publication that lets parents know they are doing everything wrong. The deal was done for $51.53 per share, a generous 12% premium from Meredith’s Friday closing price of $45.94. While the boards of both companies approved the deal, the FCC must also gives its blessing for this union, which is estimated to rake in $3 billion in annual revenue. And here’s a little fun fact: Meredith Media began in 1902 as an agricultural publisher. Who knew?

Fit to be upgraded…

Image courtesy of iosphere/FreeDigitalPhotos.net

Image courtesy of iosphere/FreeDigitalPhotos.net

Nothing says fit like having your stock upgraded by Morgan Stanley to overweight. Oh the irony.  Morgan Stanley had initially classified the stock as equal weight as in, it’s right where it belongs. But alas! Morgan Stanley has been noticing how Fitbit has been performing really nicely lately, fiscally speaking of course, and expects the maker of the wearable device to outperform aka overweight. That is a finance term, I kid you not, which also can mean (and does in this instance) outperform. And who does’t love a stock that is overweight and outperforms? Hence, the stock rallied today. In fact, Fitbit had its biggest jump today since June, when it debuted at a relatively modest $20 per share. Second quarter revenue tripled from a year earlier to over $400 million, compelling Morgan Stanley to revise Fitbit’s target price from a paltry $43 per share to a handsome $58 per share. And it’s no wonder since Fitbit has a staggering 21% piece of a a $10 billion industry. As for that little company we call Apple, it appears that wondrous watch they peddle isn’t swaying those Fitbit wearers, many of whom have decided against purchasing that ever wondrous piece of technology. Fitbit’s stock price, btw, hit $34.77 and closed today at $35.49.

An ice cold one…

Image courtesy of Getideaka/FreeDigitalPhotos.net

Image courtesy of Getideaka/FreeDigitalPhotos.net

Because it’s the thing to do, Heineken is adding to its stash of beer selections by welcoming craft brewery Lagunitas Brewery to its foamy fold. Apparently craft beer is the new black and has been growing at a steady clip compared to its less craftier counterparts, whose growth rate has slowed considerably. In fact, one out of every ten beers is a craft beer. Clearly it’s all the rage. Lagunitas’ beverages, most notable for its India Pale Ale, are reputed to be so tasty, that the company shipped out 600,000 barrels just in 2014. Unfortunately, now with Heineken taking a 50% stake in Lagunitas, the California-based beer company no longer gets to sport the craft brewer status. In order to be classified in that illustrious category, a company must be less than 25% owned or controlled by a larger brewer. Oh well. But at least with Heineken buying it, Lagunitas gets to spread its foamy wings and bring its tasty ales to other parts of the world that have yet to experience the joy that is…Lagunitas.

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One response to “Mega Media Merger; Fitbit is Overweight…And That’s a Good Thing; Some Foam for Thought

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