Watson Looking For Acquisitions But Investors Over-React

CFW View: News that Watson is on the lookout for one or two large acquisitions has quickly spread through the financial media and has been interpreted as the highlight of the company's investor conference call. While we do detract for the significance of CEO Paul Bisaro's comments, we note that undue weight seems to have been attached to his words. We feel the share price contraction seen immediately following the call on January 11, as investors fear an expensive acquisition, is an overreaction and it is likely to recover quickly in the coming weeks.

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