Check out our trading idea of the week below.
Trading idea of the week
NASDAQ:ATVI - Activision Blizzard Inc - BULLISH BIAS
- Key levels on the chart - consider taking trades from key support/resistance zones.
Microsoft's proposed buyout presents the potential for shareholders to realise its value.
Amid management scandals, Microsoft has made an offer to buy ATVI for US$95 per share.
- Activision first appeared in the Berkshire portfolio after it was purchased by one (or both) of their smaller money managers – Todd Combs & Ted Weschler.
- Berkshire’s bet on Activision is a return to the old days of “workouts” for Buffett – a simple bet on Microsoft’s deal being approved, and shareholders capturing the spread between the current market price and Microsoft’s offer of $95/share.
- I suspect Buffett (with help from his other managers) wouldn’t mind owning the underlying business should the deal fall over too, as it has a strong track record of earnings growth.