When on the hunt for potential stock buys, investors should also know about the three stocks below that could be on the shopping list of other companies for takeovers.
It usually isn't advisable for Foolish investors to buy into a potential takeover target just to sit on the shares hoping that someone else will come along and make a bid. That could be long to never, and if the stock is not making you good returns, it could be dead money.
— What to look for in a potential takeover target
Surprisingly, many times it's better to get in on a takeover bid after the first bid has been made. You probably will miss out on any initial share price jump, but consider that a type of insurance that something might actually take place.
— Even Warren Buffett waits
The first takeover offer can put the stock "into play" and attract other potential buyers because if they don't act quickly, the company could be bought out.
— Potential takeover targets
Myer Holdings Ltd (ASX: MYR)
One of the leading department store companies alongside David Jones, it is being adversely affected by recent weak retail trade plus the competition from pure online, as well as international retailers moving into the Australian market. It could be more attractive now since David Jones will be taken over by South Africa's Woolworths Holdings Limited (Johannesburg: WHL).
Ten Network Holdings Limited (ASX: TEN)
One of the free-to-air TV and media networks including TV channels TEN, ELEVEN and ONE could be in the sights of other media companies if the media laws controlling ownership of multiple media outlets are changed. Business hasn't been fantastic for the company recently and ratings-driven advertising needs improvement. That could make it an attractive choice should the opportunity come open.
Graincorp Ltd (ASX: GNC)
Already one takeover bid by US-based Archer Daniels Midland (NYSE: ADM) got knocked back by the Australian government even though the integrated grain business company recommended the takeover bid. The stock initially rose from $9 to as much as $12.82.
However, when the Treasurer Joe Hockey did not allow the takeover on national interest reasons in late 2013, the share price plummeted to a $7.50 low. It's still under $9 now.
But the story isn't done there. ADM may be circling back to Graincorp. Its CEO has visited Australia this month, so there may still be interest. Keep this one on your radar.
