Exclusive: Analyst Martin Pyykkonen On A Few Top-Name Buyout Rumors

Benzinga recently had the chance to talk with independent analyst and 20-year market veteran Martin Pyykkonen about the swirl of recent M&A rumors surrounding Level 3 Communications, Inc. (NYSE: LVLT), Yahoo! Inc. (NASDAQ: YHOO) and Twitter Inc (NYSE: TWTR). Here’s a rundown of his take on the three potential buyout targets.

Level 3

“I think Level 3 has done a pretty good job,” Pyykkonen told Benzinga. “I mean, they were basically a dead company a few years ago. They’ve reinvented themselves and I think refocused pretty well and obviously fiber plants from the infrastructure side and the enterprise account base have been the two things that have been driving the better story, and I think from everything I can tell convinces the Street pretty well.”

In terms of a buyout, Pyykkonen told Benzinga that he doesn’t see Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) paying a premium for Level 3 when the stock is trading at all-time highs, but Comcast Corporation (NASDAQ: CMCSA) might.

“I think, you know, Comcast might just because that’s kind of right in their bread and butter of what they need to be doing,” he said.

Twitter

When Benzinga asked about Twitter, Pyykkonen said a lot of the company’s damage has been self-inflicted.

“If you want to use a football analogy, it’s like they keep getting the ball on offensive and keep fumbling,” he said of Twitter.

In terms of a buyout, Pyykkonen said that traditional media companies like CBS Corporation (NYSE: CBS), Time Warner Inc (NYSE: TWX), Walt Disney Co (NYSE: DIS) and Viacom, Inc. (NASDAQ: VIA) (NASDAQ: VIAB) are all likely interested in Twitter to varying degrees.

“I don’t know which of them would be the most likely buyer [...] but a traditional media company, I’m a little surprised one of them hasn’t stepped up with Twitter being off so much. This is a valuable property.”

Yahoo

Finally, Pyykkonen told Benzinga that he’s not a fan of Yahoo and neither, apparently, are any of the company's rumored buyers.

“I’ve been very negative on Yahoo in terms of the core business just frankly eroding, and I don’t know why anybody would want to buy it at any premium. You’ve seen the sort of speculated numbers and a lack of anybody really stepping to the table supporting that,” he concluded.

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Disclosure: The author holds no position in the stocks mentioned.