Post Holdings Inc (POST), Navistar International Corp (NAV): Mario Gabelli Offers These Takeover Targets

The brands of Post Holdings Inc (NYSE:POST) include the aforementioned Shredded Wheat as well as Grape Nuts, Honeycombs, Alpha-Bits, Pebbles, and other cereals. While these brands alone may be attractive to a potential suitor, Mr. Gabelli is buying more than a company, he is buying a “gifted” CEO.

Bill Stiritz led Ralston Purina and later Ralcorp with great success that Mr. Gabelli believes will be repeated at Post Holdings Inc (NYSE:POST). He is confident Mr. Stiritz, who has done a couple of deals already, will build Post into a very attractive company over the next five years. The market cap for Post is a modest $1.5 billion and Mr. Gabelli believes this is a good hunting ground for investors.

Final thoughts

Buying stocks based on their attractiveness as takeover candidates is tough, but I don’t think that’s what made Mr. Gabelli successful at picking such stocks. With each pick, he also pointed out that there were other long-term reasons to own the companies.

In the case of Navistar International Corp (NYSE:NAV), he stated the company will produce $15 billion in revenue and $1 billion of EBITDA over the next few years. Hillshire is in the midst of a turnaround that’s looking good so far. Post Holdings Inc (NYSE:POST) is an iconic brand led by Bill Stiritz, who has a proven track record. Whether you believe in these stocks or not, don’t bet against Mario Gabelli.

Alex Gray has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article Mario Gabelli Offers 3 Takeover Targets originally appeared on Fool.com.

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