Q: Peter, I think for most SC shares at this price offer a safe 3-4% return in about 6 months
The deal Drug Mart shareholders will have the ability to choose whether to receive $61.54 in cash or 1.29417 Loblaw common
so
So worse case today buy at 59.69 sell in 6 months at 61.54.Profit of 1.85
Or 1.85/59.69x100= 3.09 % over 6 months
Add a total of a possible 2 dividends (xdiv in sept and dec) that is an additional 57 cents
Total then 1.85 + .57 = 2.42 guaranteed. A return of 4% over 6/12 or 8% annualized
Better case L is higher, eg 52.00 its 52 week high then 1.29x52= 67.00 a return of 13% or 26 annualized
In fact today L is 48.71 (48.71x1.29417=63.00)
The deal Drug Mart shareholders will have the ability to choose whether to receive $61.54 in cash or 1.29417 Loblaw common
so
So worse case today buy at 59.69 sell in 6 months at 61.54.Profit of 1.85
Or 1.85/59.69x100= 3.09 % over 6 months
Add a total of a possible 2 dividends (xdiv in sept and dec) that is an additional 57 cents
Total then 1.85 + .57 = 2.42 guaranteed. A return of 4% over 6/12 or 8% annualized
Better case L is higher, eg 52.00 its 52 week high then 1.29x52= 67.00 a return of 13% or 26 annualized
In fact today L is 48.71 (48.71x1.29417=63.00)