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Baker Hughes - Is ValueAct Providing 'Mullet Money'?

Activist investor ValueAct took a 5% stake in Baker Hughes in January.

BHI trades at 14x EBITDA and could be considered overvalued based on a variety of metrics.

Baker Hughes' Q2 2015 financial results was dismal, and Schlumberger recently gave a grim outlook for the oil services space.

ValueAct appears to be providing mullet money.

Picture of Mullet. Source: coorongwildseafood.com.au

ValueAct Capital Management recently turned up the heat on Baker Hughes (NYSE:BHI) after divulging its 5% stake in the company:

In a regulatory filing, ValueAct said it believes shares are undervalued and, as such, the firm intends to discuss with Baker Hughes's board ways to enhance shareholder value--including potentially adding a ValueAct representative to the company's board. ValueAct said it will also discuss the company's mergers and acquisitions strategy, executive compensation and capital allocation, among other items.

BHI has been practically flat since January when ValueAct took its take in the...


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