Today was a big day for the Dividend Dollars portfolio! So I just wanted to write this quick article to inform you on the news and update you on a sell in the portfolio. That way you don’t miss the sale by a couple of days by waiting for the portfolio update to come this weekend.
So the news is obvious via the headline of this post, the Microsoft/Activision Blizzard merger made huge progress today after 18 months of battling legalities. During the morning trading hours, US District Court Judge Jacqueline Scott Corley ruled that “the FTC had not raised serious questions regarding whether the proposed merger is likely to substantially lessen competition in the console, library subscription services, or cloud gaming market.”
Now, they’re not out of the woods yet. Microsoft/Activision still face the final boss of the UK’s Competition and Markets Authority, who had blocked the deal prior. Microsoft/Activision were set to appeal the ruling later this month, however both the company’s and the regulator have agreed to put a hold on the appeals and potentially find a way for the deal to continue without further battles.
Having said that, the stock price of $ATVI had opened at $82.56 and jumped to a high of $92.91, before settling at $90.80 at the time of this writing. That is roughly a 10% in one day which left the stock just a mere 4.6% away from the planned $95 per share acquisition price. That move in price and the proximity with which it approached the $95 mark tells me the market has a lot less uncertainty about the outcome of the deal.
Because of this, I sold my position in $ATVI at $92 a share today. At that level, I only had roughly 3% more to gain by holding on. That 3% boost to my profit was not worth it for me to hold through to the end.
This win was a long time coming for me as I had started my position back on 6/13/2022. Over a year ago! On 7/17/2022, I had shared my analysis of the company and the acquisition as a potential arbitrage play through this article. That analysis was nearly 2,000 words and hours of hard work. Work that earned me a third place victory in a stock competition on CommonStock! Afterwards, I continued to grow the position and wrote blog posts on the regulatory happenings throughout.
In the end, at a $74.07 cost basis, I happily took my 24.2% gain on the position and ran! That cash now sits in my portfolio as I evaluate potential places to put it to work. Thanks for experiencing this win with me, I hope y’all are celebrating!
Regards,
Dividend Dollars
PS – in honor of all things video games, come hang out with me this Thursday at 6PM MST on the Games N Gains Twitch Stream to celebrate!