You stand to benefit from their activism

Article Excerpt

Our approach to investing has a lot in common with activist investment firms. Like us, they’re always on the look out for companies with hidden assets that can be used to increase investor value. We see particularly strong value in a company’s ability to generate gains for its investors by spinning off some of its assets. Below you’ll find two examples of well-known stocks that have attracted the attention of activist investors. For now, only one of them inspires enough confidence to recommend it to our subscribers. CALLAWAY GOLF CO. $22 is a buy. The stock (New York symbol ELY; Manufacturing & Industry sector; Shares outstanding: 94.1 million; Market cap: $2.1 billion; Dividend yield: 0.2%; Takeover Target Rating: Highest; www.callawaygolf.com) gives you a stake in a leading maker of golf clubs, balls, and apparel. Activist investor Jana Partners owns about 8% of Callaway’s shares and continues to push for the sale or spinoff of all or part of the business to increase value for investors. For example,…