Barron's Discusses LBO Targets

A weekend Barron's article discusses the LBO boom and mentions some potential targets. Link $

According to the article, Morgan Stanley strategist Henry McVey says a $50 billion LBO is possible, suggesting all but the top 60 companies could be targets. Some large companies that could be targets include Gap (NYSE: GPS), Micron Technology (NYSE: MU), Bed Bath and Beyond (Nasdaq: BBBY), Nike (NYSE: NKE), Liz Claiborne (NYSE: LIZ), EMC (NYSE: EMC) and Costco Wholesale (Nasdaq: COST).

The report also says energy takeovers have mainly involved strategic buyers, but that could change. The report mentions Apache (NYSE: APA), Valero Energy (NYSE: VLO), Hess (NYSE: HES) and Transocean (NYSE: RIG) as possible targets.

In the consumer sector Avon Products (NYSE: AVP) has been the subject of takeover rumors. Merrill Lynch places Kimberly-Clark (NYSE: KMB) and Estйe Lauder (NYSE: EL) on the top of their list of targets.

Homebuilders have been mentioned as LBO targets including KB Home (NYSE: KBH), DR Horton (NYSE: DHI), Lennar (NYSE: LEN), Toll Brothers (NYSE: TOL), MDC (NYSE: MDC) and Hovnanian Enterprises (NYSE: HOV).

In technology, CreditSights says Linear Technology (Nasdaq: LLTC), Maxim Integrated (Nasdaq: MXIM), Analog Devices (NYSE: ADI), (Nasdaq: ALTR) and Xilinx (Nasdaq: XLNX) makes their list of buyout targets.