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Here’s Why Westar Energy Inc (WR) Shares Are Down

Shares of Westar Energy Inc (NYSE:WR) are off $4.22 per share, or 7.7%, after the State Corporation Commission of Kansas rejected Great Plains Energy’s purchase of Westar Energy. Fellow electric utility Great Plains Energy Incorporated (NYSE:GXP) had originally agreed to buy Westar Energy Inc (NYSE:WR) for around $12.2 billion, including assumed debt, in May 2016, but the merger unraveled after Kansas regulators took objection to the deal, saying, among other things, that the takeout price was too high and that the merger was not in the best interest of the general public. Although the merger was expected to unlock substantial synergies, Kansas regulators thought the combined company would be rather fragile and might have to raise rates for consumers. It is presently unknown whether Westar will appeal (if that is a possibility).

What Does The Smart Money Sentiment Say?

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 39.7% gains over the past 12 months and outperformed the 24.1% gain enjoyed by the S&P 500 ETFs. Our enhanced small-cap hedge fund strategy returned more than 45% over the last 12 months and outperformed SPY by more than 30 percentage points over the last 4.5 years (see details here).

Of the 742 elite funds we track, 27 funds owned $889.2 million of Westar Energy Inc (NYSE:WR) and accounted for 11.10% of the float on December 31, up slightly from 22 funds and $864.88 million respectively on September 30.

The Bottom Line

Westar Energy Inc (NYSE:WR) shares are down due to Kansas regulators giving the thumbs down to a M&A deal.  Great Plains Energy Incorporated (NYSE:GXP) shares are modestly higher, perhaps due to the relief by some shareholders that the company won’t be paying a premium anymore. For those of you interested, read ‘8 Countries That Produce The Most Electricity In the World‘.

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Soonthorn Wongsaita/

Soonthorn Wongsaita/


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