Stocks Rally On JPMorgan’s Revised Offer For Bear Stearns

Financial stocks are given a further boost Monday after JPMorgan [[jpm]] announced it is increasing its bid for Bear Stearns [[bsc]] to $10 a share, from the initial $2 per share offer, in a move to placate unhappy shareholders who weren’t at all satisfied to see Bear Stearns taken over at such a huge discount (a 93% discount to be exact). JPMorgan will also purchase 95 million new Bear Stearns shares, representing 39.5% of Bear’s outstanding common stock. JPMorgan is buying the shares at the same price as its takeover offer and the deal is expected to be done by April 8. The new takeover bid and share purchase agreement have been given the stamp of approval by the boards of both companies. Bear Stearns and JPMorgan stocks shot up on the news. Even last week, Bear rose steadily last week above $2 as investors thought the stock was hugely underpriced.

The Standard & Poor’s 500 Index [[^gspc]] rose to the highest this month while the Dow Jones Industrial Average [[^dji]] climbed more than 200 points in Monday trading.

For those of you who buy bling from Tiffany & Co. [[tif]], you have contributed to the bottomline of the second-largest luxury jewelry retailer. Tiffany stocks gained the most in more than six years on better-than-forecast earnings, on increased sales overseas and at new stores. Net income fell 16% to $118.3 million, or 89 cents a share, in the fourth quarter ended on Jan 31 from $140.5 million, or $1.02 a share, a year earlier. But excluding special items, earnings were $1.27 a share, 6 cents higher than analysts’ average forecast.

Monsanto Co. [[mon]], the biggest seed producer, posted its steepest advance since 2001 after UBS AG advised buying the shares.

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Comment by Joe

2008-03-25 16:32:51

So while ordinary people are suffering a recession Tiffany & Co is posting better profits? That just shows some people are making good money with their shorts ;)

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